Forex Forecast: Pairs In Focus - Sunday, Nov. 22

The difference between success and failure in Forex trading is very likely to depend mostly on which currency pairs you choose to trade each week and in which direction, and not on the exact trading methods you might use to determine trade entries and exits.

Big Picture November 22

In my previous piece last week, I saw the most attractive trade opportunities as likely to be in a short trade in the USD/JPY currency pair, and a long trade in the S&P 500 Index following a daily close above 3600. While the price of the USD/JPY currency pair fell by 0.70% over the week, after closing at 3626.92 on Monday, the S&P 500 Index closed on Friday down by 1.91% from that price, so this was not a profitable call overall.

Last week’s Forex market saw the strongest rise in the relative value of the New Zealand dollar and the strongest fall in the relative value of the U.S. dollar.

Fundamental Analysis & Market Sentiment

Last week was the quietest week the markets have seen for a while, with lower volatility (especially in Forex), due to the fact that there were few important news items with the exception of better than expected Australian economic data and a slightly dovish signal from the Australian central bank. President Trump is still refusing to concede the Presidential election and has alleged fraud, claiming he has won if only legal votes are counted. All the major news networks have called the race for Joe Biden, who has already been congratulated by most world leaders. Joe Biden seems to have won the popular vote by about 4%. The recount in Georgia has not changed the result there and a Trump campaign lawsuit has just been thrown out in Pennsylvania.

Strangely, although Biden seems to have no chance to not be duly elected as the 46th President, it is still possible to place a bet on his becoming the next President and to receive a 5% payout.

Another notable feature of the election result was that the Democrats seem to have made either no gains or only very limited gains in congressional elections, and it seems quite likely that Republicans will retain control of the Senate, although this will be determined by run-off elections in Georgia in January. If the Democrats win these, then there may be a stronger economic stimulus package, which could boost the U.S. stock market and weaken the U.S. Dollar.

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