How the U.S. Presidential Election May Impact the S&P 500 Index

Today, 5 November, the U.S. presidential election is underway, and it may serve as a significant driver of volatility for global stock markets.

According to EuroNews, heightened market fluctuations are expected throughout the voting period on 5 November, potentially mirroring reactions observed during the Brexit referendum and the 2016 U.S. election. Newsweek notes that historically, U.S. stock markets tend to rise regardless of the election winner. In 2020, for example, American stocks rose immediately after election day and continued upward even as Trump contested the results.

Investor’s Business Daily highlights Tony Roth, CIO of Wilmington Trust, who argues that U.S. stock markets could climb regardless of whether Harris or Trump wins, as both candidates provide viable economic paths that could support market sentiment.

On 14 October, analysing the S&P 500 chart (US SPX 500 mini on FXOpen), we plotted three narrow upward channels (shown in blue), noting:
→ each channel has a similar slope and width;
→ connecting the maximum of Channel 1, the peak and trough of Channel 2, and the low of Channel 3 outlines a larger channel (in orange).

Today’s technical analysis of the S&P 500 (US SPX 500 mini on FXOpen) shows the current index level near the lower edge of the third blue channel, with additional support around:
→ former resistance at $5678;
→ the lower orange boundary.

Election results may trigger a volatility spike, potentially testing or reinforcing these support levels, which could shape future market momentum.