The midterm elections for the U.S. Congress are behind us and delivered the results the world had largely expected. Donald Trump's party predictably lost—and not just lost, but suffered a heavy defeat. Republicans have not endured such a serious setback in a very long time. It is no secret who to thank for this. The previous Congress was Republican, but what advantage did Trump's party really have? Is it four votes in the House and three in the Senate? Today Democrats hold a 10-vote edge in the Senate and lead the House by 92 seats. Thus, even if a few Democrats cross the aisle on particular votes, that will not change the overall balance.
A fully Democratic Congress will not, however, radically change Trump's policy by itself. The U.S. president has broad powers and can veto laws he dislikes. To overturn a veto or otherwise block Trump's decrees, Congress needs a two-thirds majority in the Senate, where Democrats currently have only 54 votes. Therefore, either at least 12 Republicans would have to side with Democrats, or the Senate will be unable to impeach Trump or materially constrain his key decisions.
Still, Democrats have gained several powerful levers of pressure on the president. With control of both chambers, they can open investigations into the administration's activities, create new committees, set the legislative agenda, and block measures that cannot be enacted by executive order alone. For example, the budget for the coming year must be approved by Congress. Expect a period of bargaining: Congress will try to block as many Trump initiatives as possible while pushing its own agenda, and the president will have to compromise to get parts of his program approved.
A separate question is the confrontation with Iran. After the elections, Tehran may prove somewhat more willing to concede, because prolonged intransigence makes less sense now. Understand that Iran is also unlikely to want war with America for at least the next two years. Iran could seek support from Democrats who will exert pressure on Trump from within. But ending the war and striking a deal will require concessions from Iran as well. Both sides may conclude it is better to make concessions than to continue standing firm for several more years. That, however, depends on Trump refraining from new escalations in the Middle East. If the president returns to a military approach, Tehran will again "close ranks" and rely solely on force, meaning no concessions on core issues and continued efforts to keep energy prices high. The higher energy prices climb, the more pressure Democrats will put on Trump.
We recommend other articles by the author:
- EUR/USD review. November 9. Nonfarm payrolls send EUR another knockout.
- GBP/USD review. November 9. Bank of England fails to help. Nonfarms are not to blame.
- How to trade EUR/USD on November 9? Simple tips and trade breakdowns for beginners
- How to trade GBP/USD on November 9? Simple tips and trade breakdowns for beginners
- What to watch on November 9? Fundamental events explained for beginners
Trading recommendations for EUR/USD:
EUR/USD remains in a downtrend lacking sufficient fundamental, macroeconomic, and geopolitical support for a sustained reversal. The global fundamental backdrop for the dollar is mixed: overall fundamentals are weak, but in 2026 geopolitics and then a hawkish Fed provided strong support for the U.S. currency. When the price sits below the moving average, consider shorts with targets at 1.1108 and 1.1067. Above the moving average, longs are relevant with targets at 1.1353 and 1.1475. However, first the pair needs to break out of the 1.1114–1.1265 sideways channel.
Trading recommendations for GBP/USD:
GBP/USD continues its upward tendency, which may form part of the broader 2022 global trend. Trump's policies will continue to pressure the U.S. economy, so we do not expect sustainable long-term dollar strength. 2026 has so far been positive for the dollar because geopolitics and inflation drove capital into safe havens and forced the Fed back to tightening. On the weekly timeframe the pair remains rangebound between 1.3150 and 1.3780 within a four-year uptrend, supporting a medium-term bullish case for the pound. Consider longs above the moving average with targets at 1.3489 and 1.3550. If the price trades below the moving average, trade the downside toward 1.3306 and 1.3275.
Notes on illustrations:
- Linear regression channels help identify the current trend. If both point the same way, the trend is strong.
- The smoothed moving average (settings 20,0) defines the short-term trend and the direction to trade.
- Murray levels are target points for moves and corrections.
- Volatility bands (red lines) mark the likely intraday price corridor based on current volatility metrics.
- The CCI indicator entering oversold (below -250) or overbought (above +250) territory signals an approaching trend reversal.