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Your Ultimate Guide To Trading The US Election šŸ‡ŗšŸ‡²

PLUS: Did this trader just receive a $103,000 prop firm payout? 🤯

Today’s edition is brought to you by Lark Funding - The Leader in Prop Firm Reliability. Use code NOV20 for 20% off all their challenges.

ā˜•ļø GM Munchers! With the US election tomorrow, the markets are about as stable as a trader holding through a Fed rate announcement—grab your popcorn, it's going to be a wild ride!

On today’s menu:

  • Your Ultimate Guide To Trading The US Election šŸ‡ŗšŸ‡² 

  • A New Prop Firm Promotion Launches āœ… 

  • Enter Our $50,000 Challenge Account Giveaway šŸŽ 

  • Did This Trader Just Receive A $103,000 Payout? 🤯 

Your Ultimate Guide To Trading The US Election šŸ‡ŗšŸ‡² 

Tomorrow’s the big day, folks—the US election is here, and the markets are gearing up for what could be a rollercoaster of epic proportions. šŸŽ¢

Forget the Super Bowl—this is the real main event. Two years of nonstop campaigning, hundreds of millions spent, and now it all comes down to this.

Maybe you’re not as hyped as we are, but I bet you’re at least pumped about one thing: the chance to make some money. šŸ¤‘ 

So, whether you’re a die-hard scalper ready to hit every tick or just planning to watch the fireworks from the sidelines, there are some smart ways to approach this.

Let’s break down what’s ahead and how you might be able to profit (without losing your shirt).

1/ Trump vs. Kamala: Who Moves the Market More?

In one corner, we have Trump, the tax-cutting, deregulating candidate who’s already been priced into the market as the favourite. The markets know him, they know his policies, and Wall Street's generally bullish on his economic stance.

In the other corner, we’ve got Kamala Harris. As Vice President, she’s no stranger to the big stage, but she hasn’t had the top job before. A Kamala win could bring what we’re calling the ā€œKamala Shock.ā€ It’s unexpected, and the markets don’t like surprises. If she takes it, brace for potential volatility.

The bottom line?

A Trump victory could lead to a calmer reaction since he’s already priced in, while a Kamala win might make things a little wilder as traders scramble to adjust.

2/ What History Tells Us About Market Reactions šŸ“ˆ

If past elections are any guide, here’s what usually happens after votes are counted:

  • 1 Week After: Markets tend to be volatile as investors process the results. Think of it as the ā€œmorning afterā€ phase where everyone’s trying to piece together what happened.

  • 1 Month After: By this point, the initial reaction is over, and markets either stabilize or follow the direction set by the new (or returning) administration’s promises.

  • 3 Months After: Now we’re in ā€œpolicy mode,ā€ where the winner’s policies begin to materialize, and markets get a clearer picture of what’s to come. And by this point, it’s likely that the market has already turned it’s attention to something else, like interest rate cuts.

Historically, markets don’t necessarily tank or surge just because of an election, but there’s almost always movement in the short term.

šŸ”‘ It’s less about who wins and more about how the results align with expectations.

3/ How to Profit from Election Night šŸ“Š

If you’re thinking about capitalizing on the election, here’s a rundown of possible scenarios (not financial advice, we’re just your friendly neighbourhood trading buddy sharing ideas for educational purposes šŸ˜‰):

  1. The Trump Rally: A Trump win is considered bullish for the economy. Expect sectors like energy and finance to get a lift. But, here’s the twist: if everyone piles into risk assets like stocks and crypto, the USD might actually drop. A stronger economy might mean less demand for the safe-haven Dollar.

  2. The Kamala Shock: With Trump priced in, a Kamala win would surprise the markets. Expect a spike in volatility. We’re talking about sudden moves in equities, crypto, and possibly gold as traders adjust their positions. If Kamala takes it, keep an eye on defensive sectors like healthcare and utilities—anything seen as ā€œsafeā€ could see inflows.

  3. Trading the Sentiment, Not the Politics: Remember, it’s less about who you personally prefer and more about the sentiment. If it’s risk-on (Trump), equities and crypto might rally, with USD taking a hit. If it’s risk-off (Kamala), safe-haven assets like gold and the Dollar could see some action.

4/ Prediction Markets: Where Money’s at Stake šŸ’ø

One of the most interesting plays? Prediction markets, specifically Polymarket, which is currently showing Trump as the favorite at 58-42.

Unlike traditional markets, prediction markets let you bet directly on the outcome, and they’ll be extremely volatile on election night.

We’re talking about wild swings that could make your regular trading pair look tame.

With over $3 billion already bet on this election, it’s the place to be if you’re looking for instant action. 🧨 

5/ All Eyes on Pennsylvania šŸ‘€

If you’re staying up late to watch the results roll in, make sure you’ve got your eyes glued to Pennsylvania. This state is expected to be a major decider, and swings here could impact the entire market’s reaction.

As the votes come in from Pennsylvania, we’ll get a clearer idea of who’s leading the general election, and that will likely set the tone for the night.

If things get close, prepare for a rollercoaster.

6/ Trading Strategy: Keep Your Head in the Game 🧠

Let’s talk trading strategy. Election night is unlike any other event, and you’ll want to approach it with caution.

Here’s a playbook to keep you sharp:

  1. Remember the Inverse Relationship: Trump’s bullish stance on the economy might make stocks and crypto pop, which usually means a weaker Dollar. If you see equities and Bitcoin rising, expect USD to feel the heat. So don’t go buying the Dollar just because it’s the ā€œsafe-havenā€ currency.

  2. Stick to Pending Orders: Market orders during high volatility are a recipe for disaster. Spreads can widen, slippage can spike, and that ā€œperfect entryā€ can become a nightmare. I use pending orders to control my entries and avoid getting caught in the noise.

  3. Only A+ Setups: This isn’t the night to be experimenting. Stick to trades that align with your plan, and don’t feel pressured to jump in just because the market’s moving. If the setup isn’t top-notch, I’ll be sitting on my hands.

  4. Sidelines Are an Option: Sometimes, the best trade is no trade at all. If things get too wild or you’re second-guessing, take a step back. There’s no shame in watching from the sidelines and preserving capital.

TL;DR: Election Night Game Plan

  • Trump Win: Expect equities and crypto to rally, potentially dragging the Dollar down.

  • Kamala Win: Buckle up for volatility, with safe-haven assets like gold and the Dollar in play.

  • Polymarket: Track this prediction market if you’re looking for fast-action bets.

  • Key State: Pennsylvania is the one to watch for market-moving updates.

  • Trading Tips: Use pending orders, only take A+ setups, and don’t be afraid to stay on the sidelines.

Good luck, and may the pips be ever in your favor. šŸ“ˆ 

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ā˜•ļø Pre-Market Fuel

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