EURUSD: Downward trend.
The signal for the trend was received after a breakdown to the level of 1.0880 and consolidation of the price below.
The minimum trend target is 250 points in a 4-digit, which is at about 1.0600.
We keep sales from 1.0990.
Sales are possible with a bounce up from 1.0860 and above.
Elections and markets.
One of the reasons for the current market decline is the uncertainty with the political course of Germany, where the main elections to the Bundestag are to be held in 2021. Merkel resigns as chancellor due to health reasons. Her successor as head of the CDU party recently announced that she would not apply for the position of the chancellor, which opens up a fight for the top position in Germany, and, accordingly, the course of the main EU country becomes uncertain.
USA: The presidential race is fast approaching. Everything is clear with the applicant from the Republicans - this is Trump. But for the place of the candidate from the Democrats, an intense struggle is unfolding.
After an unexpectedly weak performance in the first primaries, Biden and Warren both take the lead followed by Sanders, who gained 26% support among the Democrats, and then Buttigieg.
Such leaders are clearly in the hands of Trump. Sanders is so left out for the average American voters as he insists on a completely free medicine and education, where a certain part of the Americans are in favor. But experts estimate that this will require a significant increase in taxes and this will certainly affect the middle class. Pete Buttigieg, on the other hand, is openly gay which somehow seems unacceptable to a significant portion of voters.
Thus, the current alignment among Democratic candidates is clearly in the hands of Trump, and, accordingly, in the hands of the US market and the dollar since Trump is pursuing an aggressive pro-business policy.
And what favors the dollar is by pushing the EUR / USD down.
