The US presidential campaign is over as Donald Trump triumphed over Kamala Harris with a lot of States supporting the former US president. This victory has brought much volatility to the financial markets and favored a massive cryptocurrency rally as Bitcoin has jumped over 90,000 for the first time in history. Those who joined the movement managed to make a lot of money. Read this article to learn how to profit from presidential elections and other political events.

Join Binolla now so you do not miss the next trading opportunity!

The US Presidential Campaign 2024

The US presidential campaign 2024 was a special one due to many reasons. Joe Biden, current US president removed his candidature allowing Kamala Harris to try her luck. As we know already, she failed to win the presidential and Donald Trump will be the next president of the US.

Starting in the middle of the year, financial markets were preparing for this event, which is clearly seen in the gold uptrend. The precious metal became very popular among traders and investors as they were trying to hedge risks in this safe-haven asset. 

One of the reasons for this interest in gold was that Donald Trump had some radical amendments to the US policy that may result in international economic turbulence. The former president of the United States promised to launch special import tariffs that would reignite the fire of trade wars. These trade wars will touch Europe and China, two of the key US partners. 

In this situation, the US dollar gained unprecedented support for several reasons. One of them was already mentioned. Another reason is that the economic adjustments that the future president of the United States will make are likely to stimulate inflation. This will allow the Federal Reserve time to consider the situation before cutting rates, which means that new expansionary steps are under question. The FOMC is still likely to make another cut during the December meeting. However, investors and traders will have to consider more factors when thinking about the meetings that will take place in 2025.

The results of the presidential election campaign still affect financial markets. Even gold, which is always in demand when there is uncertainty about the future economic situation loses ground due to the unprecedented US dollar uptrend.

How Can Traders Make Money in This Situation?

One of the main price drivers nowadays is comments that the future president Donald Trump may make in the press. Moreover, financial markets follow each and every step of this politician and weigh them. If any further news about tariffs or economic adjustments is made, this will definitely push the US dollar higher or lower depending on the context.

The EUR/USD currency pair is currently experiencing a strong downtrend as the EUR suffers from fears that the steps that Donald Trump will take in the future will decelerate the Eurozone’s economy. According to some experts, the Eurozone may lose up to 1.5% of its current economic growth, which will be a serious challenge to European economists and politicians.

And what if you bought Bitcoin after the first results were published? Bitcoin made a long path from $68,000 to over $93,000, which is an outstanding upside movement. For those who have bought one Bitcoin, for instance, the profit was around $15,000! However, even if you bought the tenth part of Bitcoin, you could make an impressive $1,500 in just one deal!

DOGE is the true leader of the post-election price movements with over 110% that traders could make. This is due to the fact that DOGE is supported by Musk who, in turn, supported Donald Trump during the presidential campaign. 

The same is relevant for Ethereum. While the scales of the growth were tinier, those who bought this cryptocurrency on November 5, 2024, could make up to $1,000 in just one deal with 1 ETH. With 10 ETH, traders could increase their profits ten times to make up to $10,000. 

Tesla stocks made a $100 path towards $340+ once the results of the US presidential election were announced. One of the reasons for this strong upside was that Elon Musk, Tesla CEO was one of the closest Donald Trump supporters. Depending on the invested volumes, traders could make hundreds to thousands of dollars in just one trade. 

Therefore, traders should primarily pay attention to what the future president will say about his plans. Moreover, one of the most important things to consider is the differences between Donald Trump and Jerome Powell (Fed’s chair), which may lead to serious price fluctuations.

Top Gainers and Losers

The table below shows the top gainers and losers that would bring you significant profits if you bought or sold them during the US presidential election.

Asset	Type of a trade	Profit %
DOGE	Buy (Higher)	112%
Tesla	Buy (Higher)	15.33%
Bitcoin	Buy (Higher)	7,28%
NVIDIA	Buy (Higher)	6.36%
Ethereum	Buy (Higher)	4.45%
WTI Oil	Sell (Lower)	2.76%
EURUSD	Sell (Lower)	2.26%
S&P500	Buy (Higher)	1.89%
USDJPY	Buy (Higher)	1.75%
GBPUSD	Sell (Lower)	1.44%
Gold	Buy (Higher)	0.7%

As you can see, DOGE Tesla, Bitcoin, and Ethereum were the top performers allowing you to make a lot of money in just one day. With over 110%% of gains after the election, Doge is the leader. However, Tesla and Bitcoin are the closest rivals. Anyway, any assets from this table as well as any other assets that you would choose to buy or sell would bring you substantial profits due to higher volatility.

US Elections 2020: an Example of Market Optimism

The situation during the 2020 presidential campaign in the United States was totally different as market participants wanted Joe Biden to substitute Donald Trump in the White House. Donald Trump was famous for its protectionist policies, while traders and investors wanted a more politician to rule America. Joe Biden was considered as a kind of relief.

The results of the presidential campaign that ended November 3, 2020, supported risky assets, including EUR as unlike Trump, Biden aimed at ending trade wars and conducting a more “usual” policy. As you can see on the EUR/USD chart, markets reacted positively to the results of the election and EUR/USD managed to move higher together with many other assets, while the US dollar lost support.

Unlike the current presidential campaign which had a mid-term effect on the financial markets, the 2020 campaign was much quieter. The left side of the chart shows that EUR/USD was in a range for a long time, which means that there were no significant events to consider. Once the market optimism won, the price moved higher.

Japanese Election 2012: How Yen Suffered from Expectations of the New Economic Reforms by Shinzo Abe

The Japanese economy was in crisis for more than 20 years on the eve of the election in 2012. Shinzo Abe promised to conduct adjustments that would help restore the Japanese economy. Market participants knew that such reforms included an unprecedented quantitive easing program which should add much liquidity to the market.

With this in view, the Japanese stock market had a massive uptrend, while the Japanese yen plunged significantly. Those who bought USD/JPY at 80-90 could have a significant profit within a year timeframe as the currency pair managed to reach 120. 

The second Abe cabinet (Abe was the Japanese prime minister from 2006 to 2007) declared “war” on deflation and recession. The strategy known as Abenomics consisted of “three arrows”.  The first one was monetary expansion aimed at achieving a 2% inflation (it should be mentioned that the Japanese economy suffered from deflation at that time). The second arrow was a flexible fiscal policy to support economic growth. The third arrow revolved around structural reform and private-sector investment to achieve long-term growth. The first arrow was very important for traders and investors as they could bid against the Japanese yen.

In 2013, the head of the Bank of Japan Haruhiko Kuroda launched the unprecedented monetary policy easing program with a large bond buying and negative rates. This was one of the arrows of Abenomics that allowed Japanese economics to boost in the following years. As it was already mentioned, traders who bid on this policy managed to make huge gains in less than one year.

Brexit and GBP/USD Decline

Along with elections, various other political events may have a serious impact on price fluctuations. One of the most interesting examples of modern political events is the Brexit referendum. The United Kingdom wanted to leave the European Union due to a lot of differences between London and Bruxelles. 

The theme of Brexit added turbulence to GBP/USD fluctuations many times. However, in 2016, it was the key price driver that resulted in a significant nosedive. 

The effect of Brexit was evident immediately after the referendum as sterling plunged below 1.30 within 30 days. One of the key reasons for traders and investors to sell the British pound is trade wars between the UK and EU weighed over financial markets.

What was behind the sterling downtrend momentum? First of all, financial market participants react to any changes and negative outlooks. When it comes to Brexit, traders and investors associated this event with future economic turbulence that the UK economy could face. 

Another reason for market participants to avoid buying sterling is fears that the interest rates would be cut by the Bank of England. The reduction in interest rates created money inflow, which pushed GBP lower. Moreover, along with lower interest rates, UK central bankers launched QE (quantitive easing) which was another reason for a large fall in value.

How to Trade Political Events

Before trading political events, you should know that there are two types of reactions to them. The first one is short-term, which occurs once an event happens. Moreover, you should also keep in mind that some events are known in advance, while others are unexpected. The second type is useless for traders as they can’t know in advance what will happen.

Therefore, we are going to consider only those events that are known in advance. As mentioned, such events provoke short-term and long-term reactions. Sometimes, both reactions move the price in the same direction, while in other cases, financial markets may revise the short-term reaction, and the price may go in the opposite direction.

In the case of the US election 2024, we can see how short-term reaction transformed in a mid-term downtrend. The US dollar had support on the eve of the presidential campaign and it is still in favor by traders and investors after elections. 

The first thing that every trader should consider is how financial markets may react to a particular event. To do that, they should learn more about the event and its probable outcomes. Those who traded EUR/USD, for instance, before the elections should check how the victory of every candidate can influence the economic and political environment.

The day of the event is very important. It allows market participants to make their strategy adjustments. For those who trade news, the day of the event is an opportunity to place a trade when the volatility is rising.

Once the event takes place, its mid- and long-term effect comes into play. Now you need to check how the market reacts to all comments and announcements that may take place in this period. For instance, when it comes to our example with the US presidential election, markets are now looking forward to hearing some updates from Donald Trump or his team. In this current context, the US dollar is likely to gain strength as traders and investors still expect a negative effect on EUR.

Therefore, there are three stages of trading political events that you should be aware of. They include:

• Expectation. At this period, market participants make forecasts and act as if these forecasts become true. However, this period is limited as at the moment when the event takes place, everything is reconsidered;
• Event. When the event occurs, it is time to place a trade according to new data. This is the moment when volatility comes into play. For news traders, the event itself represents the greatest opportunity as the price may make miles before the market calms down. The moment of the event allows market participants to use both short-term strategies (news trading) or make long-term bids trying to predict the long-term effect;
• After-event trading. Some events have short-term effects, which end once the event ends, while others may have long-term effects (current US presidential election results still impact financial markets and will influence various assets in the upcoming months). To profit from such situations, traders should think about long-term economic and political effects and place trades accordingly.

Political Events Traders Should Watch

To be able to make steps in time, traders should know in advance which political events are worth their attention. Here is the list of the most interesting ones:

• Presidential or prime minister election. This type of political event is of great importance as presidents and prime ministers are among the key persons responsible for economic development and reforms;
• Central bank head election/nomination. The head of a central bank is a key person responsible for monetary policy, which affects currencies and other types of assets. Such events may have a great impact on price fluctuations;
• Cabinet changes. Any changes in a cabinet related to economics or financial policies may have a huge impact on price fluctuations. Traders and investors assess new members’ plans and act accordingly;
• Geopolitical tensions. Any geopolitical tensions that may begin will have economic consequences. Some of them lead to instability in a particular region, while others may result in supply chain disruption.

Events to Watch in 2025

2024 was rich in political and geopolitical events, and 2025 is unlikely to be a calmer year. Here are some of the most popular events to watch in the upcoming 12 months:

Date	Event
January 20, 2025	US presidential inauguration
June 2025	Canada will host the G7 Leaders Summit in Kananaskis (Alberta)
July 1, 2025	Sofia is expected to adopt the euro and become the 21st eurozone member. In July 2024, the Bulgarian parliament passed the relevant bill on its first reading.
September 2025	Federal elections in Germany. The far right is expected to showcase its growing support during the national elections. It made significant gains in three state elections in 2024.

Conclusion

Presidential elections and various political events have a direct impact on the financial markets. Depending on the situation, they can result in short-term or long-term trends, attract traders and investors to buy some categories of assets, or make them switch to risk-off mode and buy gold and other safe-haven financial instruments. Knowing such events in advance will allow you to make informed decisions.

FAQ

Which Political Events May Affect Financial Markets?

All types of political events that may have an influence on economics will affect financial markets. They can include presidential or parliamentary elections, referendums, resignations, and many others.

Is Trading Political Events a Good Strategy?

Yes, it is a good strategy but it requires knowledge and understanding of how the outcomes may affect financial markets. For instance, the latest US presidential campaign offered several trading opportunities. However, to benefit from them, traders should follow the event and understand how financial markets treat both candidates.

Can Digital Options Traders Trade Political Events?

Yes, they can. However, due to the short-term contracts nature, they should place trades exactly at the moment when a particular event occurs to benefit from short-term momentum.

Can I Use Technical Analysis Only to Trade During Political Events?

Yes, you can, but you should be aware of unpredictable price fluctuations that may occur at these times. Even the strongest patterns may fail at some moments making it extremely risky to trade financial markets relying on technical analysis only.