Next week to watch (4-8.11.2024)

31.10.2024 13:51|Analyst Team, Conotoxia Ltd.

Investors have invested more than $4 billion in bitcoin's rise to $100k after the election. After rebounding from USD 53,000, the price of the most popular cryptocurrency has risen by more than 30 percent, approaching historic highs, with bets on a rise above USD 80,000 dominating the options market. At the same time, the price of gold has rebounded from USD 2800 per ounce. Historically, gold has lost value 77 percent of the time post-election, while the stock market has gained an average of 4.5 percent in an election quarter. We expect a correction in the gold market in the coming weeks, but our base case scenario assumes that bullion will end the year above $2,500 per ounce. Invest.Conotoxia.com analysts predict that the stock market could continue its upward movement, regardless of the election outcome. In the case of the dollar, there is no strong correlation with the election, so the decision at Thursday's FOMC meeting will be key. Invest.Conotoxia.com analysts' forecasts point to a drop in EUR/PLN below PLN 4.30 and USD/PLN to around PLN 3.90 in the coming months, with the possibility of further strengthening of the Polish zloty against the dollar in mid-2025. The Bank of England will also make a decision on interest rate cuts in the coming week.

Table of contents:

  1. US presidential election
  2. UK interest rate decision
  3. US interest rate decision

Tuesday, 5.11, US presidential election

In the final days before the election, the so-called Road to 270, the battle to win 270 electoral votes, is underway. So far, around a third of the electorate has voted in the early elections. The attention of the majority, however, is focused on the swing states, the so-called swing states, where the Republican candidate has achieved a slight lead in the latest polls. According to statistical analyses, Donald Trump wins 52 times out of 100 compared to Kamala Harris' 48 wins. Bookmakers already seem to have largely predicted the favourite, estimating that the Republican has as much as a 63.1 percent chance of winning, but we still have to wait for that outcome.

chart US elections

Source: RealClearPolitics

Impact: EUR/USD, USD/PLN, US500

Thursday 7.11, 13:00 CET, UK interest rate decision

The Bank of England kept interest rates at 5 percent in September 2024, in line with market expectations. However, there were the first dovish signals as one committee member voted in favour of cutting rates to 4.75 percent. UK inflation was 2.2 per cent in August and the Bank of England expects it to rise to 2.5 percent by the end of the year. The committee also announced a £100 billion sale of government bonds, which could support the strengthening of sterling.

Analysts forecast that the Bank of England will decide to cut the interest rate to 4.75 percent at its next meeting.

UK interest rate graph

Source: Tradingeconomics.com

A higher-than-expected interest rate could be bullish for GBP, while a lower-than-expected rate could act bearishly on GBP.

Impact: EUR/GBP, GBP/USD

Thursday, 7.11, 19:00 CET, US interest rate decision

Federal Reserve officials cut interest rates by 0.5 percentage points in September 2024 to an upper level of 5 percent to balance inflationary pressures with concerns about the labour market. Currently, according to the FedWatch tool, the market is pricing in as much as a 96 percent probability of another 25 bp interest rate cut. This means that the current pace of cuts would be slower than earlier expectations.

Analysts' consensus is for the main interest rate to fall to 4.75 percent.

US interest rate graph

Source: Tradingeconomics.com

A higher-than-expected interest rate could be bullish for the USD, while a lower-than-expected rate could act bearishly on the USD.

Impact: EUR/USD, USD/PLN



Grzegorz Dróżdż, CIIA, Market Analyst of Conotoxia Ltd. (Conotoxia investment service)

The above trade publication does not constitute an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No. 596/2014 of April 16, 2014. It has been prepared for informational purposes and should not form the basis for investment decisions. Neither the author of the publication nor Conotoxia Ltd. shall be liable for investment decisions made on the basis of the information contained herein. Copying or reproducing this publication without written permission from Conotoxia Ltd. is prohibited. Past performance is not a reliable indicator of future results.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.23% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. 

Trading on CFDs is provided by Conotoxia Ltd. (CySEC no.336/17), which has the right to use the Conotoxia trademark.

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76.23% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.23% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Trading on CFDs is provided by Conotoxia Ltd. (CySEC no.336/17), which has the right to use the Conotoxia trademark.