FX.co ★ Finita la comedia, Donald!

Rout. That is the word to describe what happened in America yesterday. Many experts, political scientists, economists, banks, and various analytical agencies predicted a Republican defeat, but few expected a complete rout. Democrats needed to pick up four additional seats in the House and four in the Senate compared with the previous Congress to secure full control. In fact, they won the Senate by at least a 10-vote margin and gained seven more seats than last time. They also took the House by a wide margin, crossing the 218 majority threshold early Wednesday morning. What followed was a rout.

Republicans lost decisively for the same reasons Donald Trump lost in 2020. American voters were so disillusioned with the "Era of Greatness" promised by Trump that they voted for Democrats. The president urged voters in the run-up to the election to vote as if his name were on the ballot—fortunately for him, Americans did not do that; otherwise, the result would have been even worse.

Is there anyone surprised by the outcome? Does anyone honestly not understand why the Republican Party lost? Does anyone consider this defeat undeserved? Voters reacted to the changes Trump brought: higher prices across the board, costly wars, inconsistent migration policy, and damaged relations with the world. In many districts voters apparently voted by party color rather than by name.

What is next? Earlier in the week we thought Trump might contest the result and call it "fraudulent." But by Wednesday morning the returns looked so decisive that the president had little option but to concede. Trump said Republicans will have to cooperate with Democrats, although he previously promised to veto any opposition proposals.

Meanwhile, Iran wins politically. Iran apparently did all it could to push American voters away from Trump and succeeded. It will now be much harder for Trump to fund military operations. Last year he requested an additional $50–80 billion for a war with Iran. With a fully Democratic Congress, is that spending likely to be approved given U.S. public debt above $40tn? The answer seems obvious. Trump will now have to negotiate on some issues and cannot act unilaterally on many matters.

Trading recommendations for EUR/USD

EUR/USD remains in a downtrend that lacks sufficient fundamental, macroeconomic, and geopolitical support to continue. The global fundamental backdrop for the dollar is negative, but in 2026 geopolitics and a hawkish Fed supported the U.S. currency. When the price sits below the moving average, shorts can be considered with targets at 1.1151 and 1.1108. Above the moving average, longs are relevant with targets at 1.1293 and 1.1353.

Trading recommendations for GBP/USD

GBP/USD continues its uptrend that may be part of a larger 2022-era trend. Trump's policies will continue to pressure the U.S. economy, so we do not expect 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 toward tightening. On the weekly timeframe the pair is in a flat between 1.3150 and 1.3780 within a four-year uptrend, supporting a medium-term bullish view for the pound. Consider longs above the moving average with targets at 1.3532 and 1.3550. Below the moving average, trade shorts toward 1.3367 and 1.3306.

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 trading bias.

- Murray levels are targets for moves and corrections.

- Volatility bands (red lines) mark the likely intraday price corridor based on current volatility.

- CCI entering oversold (below -250) or overbought (above +250) territory signals a potential trend reversal.