How I Would Trade On Trump Win As I see Policies Boost

As we are seeing results being unveiled in the US election, I am actually not so concerned on who win the ticket to the white house.

I am more interested in Republican win on the number of senate seats, With this control of the senate to the republican so how should we as investors trade.

The stock market reacted positively to the election results, anticipating growth. With Donald Trump's victory and the GOP likely holding a majority in the House and Senate, major indices rallied on Wednesday. Investors were relieved that the election would not be contested and optimistic about Trump's plans to lower taxes and reduce regulations, which could boost economic growth.

Active buying interest pushed the Dow Jones Industrial Average, Nasdaq Composite, S&P 500, and S&P 400 to record highs. The Russell 2000 gained 5.8%, leading all indices.

The S&P 500 financial sector rose by 6.2%, driven by expectations of reduced regulatory oversight and increased capital markets activity. Notable gainers included Goldman Sachs (GS), KeyCorp (KEY), and Discover Financial Services (DFS).

But if we were to look at what financial stocks we can trade after trump win with the anticipation of financials deregulation or less financial scrutiny.

The consumer discretionary sector increased by 3.6%, alongside financials, industrials (+3.9%), and energy (+3.5%). The real estate sector fell by 2.6%, and utilities by 1.0% due to rising market rates. The consumer staples sector declined by 1.6%, affected by a stronger dollar and potential tariff retaliation.

I am expecting more upside coming from Amazon as potentially Lina Khan would be out and the cases against Amazon might be reduced and this should benefit Amazon, as it is time for Amazon to engage US government again as spending should be increasing with the new administration.

If we looked at the technical, we are seeing clear signals from MACD and MTF that AMZN is moving on an upside trend, and this stock could be in defensive strategy against any potential Fed rate decision reversal.

Small-cap stocks and financial stocks surged. The U.S. dollar strengthened against other major currencies. Bitcoin prices increased significantly.

Cyclical sectors outperformed the market. Treasuries were sold, leading to higher yields. If we looked at this trend, we could be seeing investors going into crypto as safe haven as there might be some volatility during the first year of transition.

If you have been following MARA, there have been much volatility over the past week, and MARA drops below the short-term and long-term MA, and now we are seeing MARA trading above these levels ahead of its earnings next week (12 Nov).

So this might be time for us to consider MARA as Trump win would boost crypto miners, one of the significant names would be MARA.

I am holding onto my position in MARA as we looked forward to its earning result next week (12 Nov). I expect MARA to clear the $20 dollars if their mining expenses is reduced with Bitcoin prices going up.

Palantir have been one of my best stocks and there have been still high valuation and overvalued stock price on Palantir, but I hope we do take a moment to think of how AI is going to develop over the next few years in terms of software.

To me, Palantir is the equivalent of Nvidia or Alphabet on the AI software platform side. One more important notes is if inflation creeps back, then Fed might start rate hike again, then Palantir could be one of the defensive stocks we can hold to shoulder the risk.

This might explain why there is a price surge in Palantir. If we looked at the technical using MTF (multi-timeframe), we are seeing a strong upward trend.

Palantir is trading above the short-term and long-term MA and MACD just make a significant bullish crossover upside. This could mean that we might be seeing Palantir readjusting to a new highs.

I am still holding onto my position for Palantir as this should form part of my defensive strategy in case inflation creeps back and Fed decide to rate hike.

Treasuries faced selling pressure, with the 2-year note yield reaching 4.29% and the 10-year note yield hitting 4.48%. A $25 billion 30-year bond auction saw strong demand, slightly easing yields. The 2-year note yield settled at 4.27%, and the 10-year note yield at 4.43%.

The Federal Open Market Committee (FOMC) is expected to announce a policy decision, likely cutting the fed funds rate by 25 basis points to 4.50-4.75%.

Summary

If we looked at how trump policies could affect the stocks, there is also a possibility of a potential rate hike if inflation were to creep back. So I would think we need to adjust our strategy to cover both defensive and growth.

Appreciate if you could share your thoughts in the comment section whether you think these stocks are something that you would look at.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.