This Weekend’s Special: French Presidential Election!
As we know, political events have a huge impact on the currency market, and presidential elections often take the cake in causing momentous market volatility. Remember the US Presidential election last year? And now it’s time to buckle up for the French presidential election this Sunday. The Euro is already on the move, and more is coming.
This Sunday, April 23, is the first round of the French Presidential Election. France is the third largest EU economy (after Germany and UK – the latter still in the EU for now), therefore, whatever happens with the country will have a serious effect on the global markets.
Sunday’s election will have 11 candidates, and no clear leader in sight up until the last days, causing frustration among investors, given the possibility of Marine Le Pen, leader of the far-right National Front party potentially becoming a President. On Thursday, the opinion poll was released, indicating that centrist candidate Emmanuel Macron is in the lead. The news has immediately sent the Euro to its highest level against the dollar in April.
The Harris Interactive opinion poll showed that 25% of voters intended to vote for Macron in the run-up to Sunday’s first round of voting, ahead of Marine Le Pen, leader of the far-right National Front party on 22%.
Republican candidate Francois Fillon was at 19% and left-wing candidate Jean-Luc Melenchon was also at 19%.
The poll also showed Macron comfortably beating Le Pen in the second round of voting two weeks later at 66% to 34%.
The poll results came as a good news, so the Euro went up. However, it’s hard to predict what happens next, since both Marine Le Pen and Emmanuel Macron are euro skeptics. Both candidates want to put France’s EU membership to a vote. Still, investors regard Macron as the ‘lesser evil’ compared to Le Pen. Since mid-March until mid-April, we saw the Japanese Yen rising as investors resorted to this ‘safe haven’ currency. However, as the poll results were announced, investors seem to regain some confidence in the Euro.
The bottom line being, while investors bank on different scenarios, no one knows what will happen over the weekend, and how the markets will open late on Sunday night (Asian morning).
As it usually happens in these situations, there is a risk of markets opening with a crash next week. As a beginner trader, you should consider either closing your positions on Friday midnight, or ensuring you have sufficient margin (balance) to cover market volatility if you want to take a calculated risk. As a safer bet, consider trading and following Harborx Star Traders’ recommendations in the days before and after both election rounds.
Traders worldwide will try to benefit from the French Presidential Elections, and so can you – either by trading or simply following the news and global markets. Learning opportunities like these don’t happen too often, so make the most of it and don’t forget to have fun!
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