As the U.S. market emerges from its recent elections, the effects impact multiple markets. From cryptocurrencies, indices, and safe-haven assets – the current economic landscape has significantly changed throughout the last couple of weeks.
Hi-tech boom
Following Donald Trump’s recent electoral victory, the cryptocurrency markets have experienced an unprecedented surge, particularly highlighting the performance of Bitcoin, Ethereum, and Solana.
As investors have to deal with the high volatility of crypto, BTC ATH has been broken several times after the U.S. elections. ETH USD today also is way beyond the level from the first days of November. These two major cryptos didn’t disappoint investors in the post-election mayhem.
However, behind BTC / USD and Ethereum, a new force engages traders in worldwide markets. Solana (SOLUSD) set a new all-time high as well, presenting its growing relevance and adoption in the decentralized finance (DeFI) space. All of these assets reflect a broader hi-tech boom, accelerated by a constantly growing interest in blockchain technology and digital currencies as pivotal components of the future economy.
Safe-haven turbulences
As the market for volatile assets like cryptocurrencies experiences a surge, traditional safe-haven assets have seen some fluctuations. Typically regarded as more stable investment choices during uncertain times, assets such as the Swiss Franc against the Japanese Yen (CHF/JPY) and gold have experienced slight downturns. XAUUSD today is at a much lower level than a month ago due to a reallocation of capital towards higher-risk assets.
However, for long-term traders, these safe-haven assets’ historical stability and enduring value provide a solid foundation for maintaining confidence. Historical data continues to keep traders calm – analysts call them “safe-haven assets” for a reason. Recent cycles show that gold or some of the major currency pairs can still serve as a hedge against inflation.
The strength of the U.S. Dollar
In the aftermath of the U.S. elections, the U.S. Dollar has presented remarkable strength across various forex markets. The USD/JPY exchange rate demonstrates the dollar’s robust performance against the Japanese Yen right after major changes in August.
Similarly, the exchange rates with Dollar to Rands (USDZAR) and USD to KRW reflect a strong USD in diverse markets.
However, investing USD/MXN currency requires an even more thorough approach. Together with a robust USD, traders must keep tabs on current affairs between the Trump administration and Mexico. This uncertainty could impact market volatility and requires careful consideration by investors looking to engage with this currency pair.
American economy on the rise
The power of the U.S. Dollar comes together with several pivotal economic indicators. Among these, the SP500 index, which tracks large-cap U.S. equities, showed significant growth.
The rise of American stocks is evident, especially in the tech sector, as represented by the US100 index. Companies like AMD and Palantir shares have demonstrated robust performance.
The correlation between the strong dollar and the rise in these indices is not a coincidence and offers strategic insights for market participants.
Summary
Post-U.S. election results have led to a significant boom in cryptocurrencies like Bitcoin, Ethereum, and Solana, while traditional safe havens like gold experienced fluctuations. The U.S. Dollar has shown remarkable strength, influencing key indices like the S&P 500 and NASDAQ, which have notably risen, especially within the tech sector.
