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US election: make or break levels for the US 500 cash

News that the FBI were no longer investigating Hillary Clinton has caused risk appetite to increase in Asia and we have seen the US 500 cash market rally strongly in Asian trade.

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Source: Bloomberg

I am struggling to get too excited though, and see this pop more as a position adjustment as traders cover short positions. There could easily be more anxiety ahead of this week’s vote. The final vote in the Electoral College system is far from certain (although it is likely) and it is still hit-and-miss that Clinton gets the required 270 votes here.

A break back above 2116 (the series of lows in September and October) would be positive and should take us to 2154 – the September downtrend. However, price could just as easily roll over from here and head south – this could be a very telling trading session ahead of us. Watch price and jump on the move if the sellers start to get the upper hand again.

While it would be positive for the markets to see a Clinton win, we must remember that ‘more of the same’ is hardly that inspiring in the first place.

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