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Hold on to your hats!

The ride is about to get interesting as the melt-up in risk assets could get seriously torrid in the weeks ahead.

With the GSA releasing funds for the Biden administration to start the process of transitioning to a new President, and Pennsylvania certifying Biden’s electoral win in the state spurring risk sentiment, the optimism drove the Dow and S&P500 to new record closes.

Expectations of a vaccine solution being imminent and a Biden administration that will use science-based policies to tackle the Covid crisis are driving hopes that there will be an end to this cycle of surging and ebbing virus spread. Biden’s picks for his cabinet thus far are also reassuring investors that the age of allocating senior roles to friends and family without the experience to do the job is over.

Biden’s announcement that he will rollback Trump’s confrontational “America First” policies is also another reason for optimism for the year ahead. Various banks are rushing out reports citing optimism for global markets and emerging markets for the ahead.

The ride is about to get interesting as the melt-up in risk assets could get seriously torrid in the weeks ahead.


  1. Gold & Silver — Reduced Gold position by yet another 1/3 as support for Gold at 1810–15 broke. The next support is at 1780–90. Silver is again trading soft along with Gold despite the weaker USD against the majors. Short term support for Silver is at 22.50–60 while major support is at 21.80–90. Price action for precious metals is confusing many as there seems to be no clear catalyst for this persistent weakness. It almost seems like there is a rotation from these two precious metals into Bitcoin as the theory of “digital gold” gains traction. Platinum should be tracking this weakness in gold and silver if there’s a good reason for precious metals to be losing their luster but Platinum was up more than 3% yesterday!

Key risks — Higher US interest rates and a stronger USD are the main risks for now. Ebbing transition risk is good for risk sentiment, and any unexpected escalation could be a setback.


Market Movements as of New York Close 24 Nov 2020
  • Dollar fell on Tuesday as risk appetite improved after Trump accepted the transition to a Joe Biden presidency and optimism that COVID-19 vaccines are close to being rolled out. The General Services Administration on Monday finally acknowledged Biden as the apparent winner of the 2020 presidential election, allowing his team to get working on the logistics of the transition. President Donald Trump acknowledged the move in a tweet, attempting to take credit for the decision, but stressed that it did not amount to a concession. By law, the president-elect cannot access federal transition funds or contact federal agencies to plan staffing until the GSA recognizes an electoral winner.
  • The EUR gained 0.49% to $1.1897. Riskier currencies outperformed led by the AUD rising 1.12% at $0.7366, after earlier touching an almost three-month high of $0.7373. The NZD hit a more than two-year high of $0.7005 as investors scaled back wagers of more policy easing by the country’s central bank, and was last up 0.82% on the day at $0.6978. Bitcoin gained more than 4% to $19,139 and is approaching its record high of $19,900 from December 2017.
  • U.S. Conference Board’s Consumer Confidence Index dropped to 96.1 in November (expected 96.5) from an upwardly revised 101.4 (from 100.9) in October. Consumers going into 2021 don’t foresee the economy and the labor market gaining strength, as attitudes about business conditions for the next six months have worsened.
  • The major indices rose more than 1.0% on Tuesday in a record-setting session. The Dow Jones Industrial Average (+1.5%) topped the 30,000 level for the first time ever, the S&P 500 (+1.6%) closed at a record high, the Russell 2000 (+1.9%) set fresh all-time highs, and the Nasdaq Composite gained 1.3%. Nasdaq was struggling in the early part of the trading session and was even in negative territory while the other indices were up on the day. As the session wore on, it shrugged off rotation selling and powered to a strong close towards the end.
  • Value, cyclical, and small-cap stocks retained their leadership roles in this part of the bull market, and the bullish bias carried over to most parts of the market. The S&P 500 energy (+5.2%), financials (+3.5%), and materials (+2.5%) sectors outperformed, while the real estate sector (-0.03%) slipped into the red.
  • Wells Fargo (WFC 28.60, +2.30, +8.8%) was double upgraded to Outperform from Underperform at Raymond James, and numerous retailers reported better-than-expected earnings reports.



President-elect Joe Biden said on Tuesday the United States will be “ready to lead” again on the global stage, turning the page on President Donald Trump’s “America First” policies as he pledged to work together with the nation’s allies.

Introducing his foreign policy and national security team, the Democratic former vice president signaled he intended after taking office on Jan. 20 to steer the United States away from the unilateralist nationalism pursued by Trump.

Over the last 4 years, Trump unsettled many U.S. allies, in Europe and elsewhere, with an antagonistic approach toward the NATO alliance and trade relations, abandonment of international agreements and warm relationships with authoritarian leaders.

Pennsylvania became the latest pivotal state on Tuesday to certify that Biden had won. The Nevada Supreme Court on Tuesday also confirmed Biden had won the state, sending the results to Nevada’s Democratic governor for final certification.

Thematic Context: “As mentioned, the market is getting fatigued by the shenanigans and we believe that once a clear winner is announced (most likely Biden), markets will climb over this wall of worry and rally ahead.” — 22nd Nov 2020


U.S. officials said on Tuesday they plan to release 6.4 million COVID-19 vaccine doses nationwide in an initial distribution after the first one is cleared by regulators for emergency use.

Officials from the government’s Operation Warp Speed program told reporters that states and other jurisdictions had been informed on Friday of their estimated vaccine allocations in the first shipments so they can begin planning for how to best distribute it to their high-risk populations.

The officials had previously said they anticipate 40 million doses will be distributed by year end, a number they reiterated on Tuesday.


President-elect Joe Biden’s Treasury secretary will need Congress to approve re-use of $455 billion in funds that the Trump administration is taking back from the Federal Reserve and other pandemic lending programs, the Treasury said on Monday.

Current Treasury Secretary Steve Mnuchin last week said he would allow some little-used coronavirus lending programs at the Federal Reserve to expire on Dec. 31 and allow Congress to spend the funds on other aid for businesses and individuals.

Biden’s transition team called the move, which restricts the new administration’s ability to backstop financial markets during a worsening pandemic, “deeply irresponsible.”

Thematic Context: “Yellen has called for increased government spending to boost the U.S. economy out of a deep recession brought on by the coronavirus and has frequently cited growing economic inequality in the United States as a threat to America’s values and its future. At Treasury, she would have a major role in influencing U.S. fiscal and tax policy, tools she did not have at the Fed, which she chaired from 2014 to 2018. She was the Fed’s vice chair from 2010 to 2014.

U.S. stocks picked up ground following the report, with investors seeing Yellen as a force for more fiscal action to combat the economic crisis unleashed by the COVID-19 pandemic, and as someone in a strong position to ensure the Treasury will continue to work closely with the Fed. This is a bullish development for risk assets.” — 24th Nov 2020


US GDP: The US releases a second estimate GDP for Q3. The forecast stands at 33.1%, unchanged from the initial estimate.

FOMC Minutes: The minutes of the Federal Reserve’s November meeting will provide details of the meeting and could shed light on any plans by the Fed to ease monetary policy.




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Phan Vee Leung
CIO & Founder, TrackRecord




Our market summary condenses the most important market events into a short read.

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