As consensus predicted, Republicans not only tightened their grip in the House of Representatives,, but with a 7 seat gain they took control of the Senate, which is something they haven''t been in control of since 2006.
While many commentators are saying this will force Obama to work with Republicans over the remainder of his term (which may or may not be true, who knows), one thing this will almost certainly lead to is a reigned in F_E_D as the Republicans will be keen to call the F_E_D before Congress to "explain their policy decisions" which a wide array of Republicans vastly disagree with, thus this election for the market may be about the F_E_D and how it effects F_E_D policy moving forward more than anything.
Index futures pushed higher following USD/JPY on the Republican gains...
Also there are similar supporting early divergences in the $USD which was responsible for pushing the carry pair higher (not only longer term as seen yesterday, but intraday as well)...
Treasuries were also sold off overnight, but at least in the 10 year's case, Treasury futures seem to be getting ready for a reversal.
I suspect this will effect Index futures soon as NASDAQ and Russell Futures have seen negative divegrences through almost all of the overnight move higher.
As always, flat , dull markets are dangerous markets, we'll see how many ways this one jerks, I suspect more than just this overnight knee jerk.
No comments:
Post a Comment