Until Friday, Oct. 28, Wall Street had awarded presidency to Clinton. Wall Street’s view was backed up by polls. Tuesday, according to the algorithms at The Arora Report, institutions were heavy sellers of stocks. Take a look at the annotated chart of S&P 500 ETF SPY.
Please click here for annotated chart of SPY
The chart shows a break of technical support. Clearly Wall Street was having second thoughts and realizing that awarding of the presidency to Clinton was premature. But does that mean it’s selling time for you?
On Friday, FBI director Comey revealed in a letter to Congress the discovery of more Clinton emails to be looked at, albeit from an unrelated case. The heart of the issue is the potential presence of classified information in the newly discovered emails. At this time, there is no official indication if the newly discovered emails contained classified information. There are three potential scenarios as we see it described below:
- The newly discovered emails are duplicates, and there is no classified information in them. If this turns out to be the case before the election, the market will rally as Wall Street will go back to awarding the presidency to Clinton before the election.
- It becomes known before the election that the newly discovered emails contain classified information. In this scenario, the market will fall as Trump would more likely become the potential winner.
- Nothing new is known before the election. In this scenario, the market might stay volatile.
The polls have tightened. The latest ABC News/The Washington Post poll shows Trump ahead of Clinton, 46% to 45% within 3% margin of error….Read more at MarketWatch
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