How I Traded The US Election And Doubled My Forex Account In One Day

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The days prior to the US Election on November 8, 2016 had been tense. Here is the United States of America, a country whose currency is a big player in the forex market, is presented with two candidates. One with no political experience, the other branded as a liar and a criminal. Hard choice. But as a believer of fundamental analysis, I knew it was time to study the ideologies and background of these two presidential candidates; look for opportunities this might present. So time-consuming and boring as it might have seemed, I watched all three presidential debates. The rest is now history.

After studying the market and the influence the candidates can have on the market, I set aside a $10,000 account to implement the strategy that I have brainstormed. At the time of writing this, this is the state of my account:

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balance

I am not regretting I hadn’t deposited $20,000 or $40,000. At this moment I am chuffed to have been able to pull this off in a day. Most important thing here is what I learned and how I thought through to make this vision a reality.

Let’s break it down. 26 trades placed with a profit factor of 19.36. A massive 1061 pips amassed! This proves why you shouldn’t take fundamental analysis for granted. My best trade was $2,452.70 and a worst trade of -$552.58. With a total of 26 lots traded, trading a lot each time.

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OK. So How Was It Done?

We have two candidates, a Democrat and a Republican. The Democrats have the reins now so Clinton winning would mean continuation of current administrative policies. Donald J Trump winning would mean the opposite of whatever is set in place by Barack Obama. Trump is eager to repeal most, if not all, of what the Obama Administration have set in place.

I stayed up all night (residing in Europe) just to watch how the result roll in in real time. Using tools like Twitter and BuzzFeed which provided live feeds of results as they were release. Based on this and some fact I had learned earlier about how the stock bounces a day after the election days. I was sure that there was going to be something similar with the US Dollar. A V-shaped recovery pattern.

The reaction of stock markets as far as my investigation prior to the election was that, stocks rise with Hillary Clinton and fall with Donald Trump. This is actually quite easy to realise considering historic data and the ideologies of their respective parties. Simply, Donald Trump and his party offer an anti-trade, populistic stance and an economic plan where the numbers don’t add up, presenting a lot of uncertainties. On the other hand, the economic policies of Hillary Clinton don’t sound outlandish. But as stated above already, her winning would mean a continuation of current policies. This coupled with the Presidential Election Cycle Theory, are what made me decide the USD will go down as Mr Trump wins. But there’s something more to this.

 

As the results trickled in slowing with Trump leading widely midway, this behaviour of the USD became prevalent:

usd_down

But do you remember the V-shaped recovery pattern that has been repeating itself after each election day? You do. You can sie the V-shape in the image above as well. Home run!

Later I rode along with the volatility just for the fun of it. Of course there’s a whole lot more to this. I won’t make this post too long. Feel free to subscribe to for my 5-Day Email Lessons on “How I made my first $10,000 Trading Forex”.

I wish you the same success.


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