Mail vote, the surge in COVID-19 cases in the US-led too many people to choose mail vote on voting in person making it more difficult for some states to declare a winner immediately after the voting.
Biden’s Advantage, Biden has 264 out of 270 votes required in the electoral college to win the presidency. At present, all eyes are on Nevada, if Biden wines this state he would get the 6 votes he needs to become the elected US President regardless of what happens with other key states like Pennsylvania.
A President Without Majority, polls of a blue wave in the US proved to be wrong as Republicans seem to be on course to keep their Senate’s majority, and Democrats to keep theirs in the house. A Republican Senate will hinder Biden if he wins the presidency from passing his legislative agenda, while a Democrat House will do the same if Trump wins.
Fed Meeting, the FOMC will meet on Thursday and while elections’ results are still uncertain the Fed members will try to calm markets pledging they would do whatever it takes to help the economy back on track, although the Fed Chairman Powell may stress the importance of the stimulus package for the economic recovery.
Global stock markets closed in the green on Wednesday as a divided Congress would hold either President from changing the current Tax policy. Nonetheless, it would mean a sub $2Trillion fiscal package.
EUR/USD and Main FX Markets
The greenback rallied on Wednesday on news of the President’s Trump intentions to contest the presidential election’s results due to “mail vote fraud”. That led investors to keep demand on safe havens like the US bonds and the US Dollar. However, Biden’s victories in key states like Wisconsin and Michigan increased the probability of ending the presidential competition without the need of waiting for the US Supreme court verdict. The US Dollar index could be on the way for a test of 91.72.
The EUR/USD rebounded on Wednesday around 1.1600 and maintained the pair’s sideways move. Therefore, the price may rally for a test of 1.1909.
The GBP/USD traders monitor the EU/UK trade talks amid concerns of differences on issues like fisheries and fair competition. The pair closed on Wednesday below 1.3048 hinting towards 1.2773.
Gold and Oil
The crude price continued its recovery on expectations of OPEC+ group may extend productions cut to post January 2021. The Brent Crude closed on Wednesday above 39.60 eyeing a test of 41.70. A close above this level could send the price even higher towards 43.58.
The Gold price stabilized above $1,861 and could be on the way for a test of $1,921. A close above that level could send the price even higher towards a test of the $2000 level.
Investors will follow the US elections updates all day and EUR/USD traders will check at 11:00 AM (GMT) the Eurozone retail sales numbers of September and will tune in the ECB Guindos speech at 1:40 PM.
The British Pound traders will follow the UK chancellor Sunak’s speech at 4:00 PM and the BoE Governor Bailey’s speech at 1:30. Additionally, the market will check the US initial jobless claims at 2:30 PM and the Fed rate decision at 8:00 PM, then the Fed chair press conference at 8:30 PM.