The market is closed Thursday for Thanksgiving while Friday is only a half day. As such, this is a holiday week and most of Wall Street will be away from their desks.
This means we can see greater volatility as trading volumes will be very light this week. This means the few traders/funds/ institutions that will be active this week will have a much easier time moving the market.
The bigger news concerns what is happening in the political arena in the U.S.
The mainstream media continues to push the completely false narrative that Joe Biden is the next president of the United States.
The people claiming this are either ignorant or lying. Unless President Trump concedes, Joe Biden has NOT won anything. This is not opinion. This is fact. NO ONE has won the election until the states formally cast their electoral college votes on December 14th.
That is how things work under normal circumstances. However, this election is anything but normal.
First and foremost, the margin of victory for Joe Biden in most swing states is under 0.5%., By law, this means a recount is MANDATORY.
Secondly, there are multiple lawsuits, some from the Trump campaign, others from private citizens, and some from state legislators themselves arguing that there is ample evidence of voter fraud and vote manipulation.
Once lawsuits are filed, the election is now in the court system.
This means that what I think, what you think, what the media thinks, what Joe Biden thinks, what anyone thinks but the judge ruling the case is irrelevant. The only items that matter are the evidence and what the judge rules on the case.
On top of this, what any particular judge rules is irrelevant to some degree because the Trump campaign can appeal a ruling, or take the case to a higher court, and ultimately to the Supreme Court.
This is why those pundits and media types who applauding the fact that an-Obama appointed judge ruled against the Trump campaign in Pennsylvania are myopic at best and simply ignorant at worst.
Applauding a particular court ruling as a big deal at this point is like applauding a field goal in the first three minutes of the Super Bowl: there is a LOT of time between now and when the game ends and a LOT of things can happen.
Ultimately, President Trump can take his case to the Supreme Court. If his campaign and prove significant voter fraud (they have several more weeks to build their case), then the SCOTUS can rule to have the federal vote audited, invalidated (meaning state legislators pick the president) or any number of specific rulings on specific states.
All of this FAVORS Trump.
Everyone knows fraud occurs during elections. It’s not a question of if, but how much. And with the SCOTUS now stacked 6-3, or at least 5-4 conservatives to liberals, the likelihood of President Trump winning this election are MUCH HIGHER than most people realize.
And the markets know it.
The Biden campaign has made it clear that it is in favor of more lockdowns, higher taxes, greater regulations, and the Green New Deal. Arguing that these policies are good for the stocks is LUDICROUS.
Which is why the recent breakout for the S&P 500 suggests a Trump win is coming. The S&P 500 broke out of a three-month consolidation phase last week. It has since back-tested this breakout, which suggests it is the REAL DEAL and the start of the new major leg higher.
If you find that hard to believe, consider that the Energy sector (XLE) has been THE top performing sector since election night. Indeed, XLE has more than TRIPLED the performance of the Tech sector (XLK) which was the former market leader.
President Trump has made it clear he wants fracking and all domestic production of oil pushed aggressively in his second term. By way of contrast, Joe Biden has made it clear he is against fracking and wants to push for clean energy in the U.S.
Who do you think the market is predicting as winner of this election? The pro-Oil candidate or the pro-climate change candidate?
With that in mind, I stand by my original forecast that President Trump will end up winning this election. And our clients are already doing this with our new special report titled…
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Chief Market Strategist
Phoenix Capital Research