This month represents the quadrennial opportunity for forex traders to trade the US elections. The election campaign is fast approaching its apex and all markets are paying closer attention to the probabilities of the outcome. In shaping a forex trading election strategy, traders need to first construct a decision tree with several branches. The first decision is to anticipate which party will win. The second task is to anticipate the magnitude of the victory. Third is to anticipate expected market reaction to the winning outcome. The market reaction may hinge on whether the election is close, resulting in no mandate for change, or whether it will be a victory allowing one party to implement its economic agenda.
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