The USD has reversed all the losses from the overnight post-election panic. It´s still advancing against all major currencies and it´s gaining pace as I type. This is just the beginning of the USD/Trump relationship, but it looks more like one of those relationships which start off as a love-hate affair.

The first market reaction was to dump whatever dollar bills anyone possessed when the first results in favor of Trump started rolling in. I was trying to keep myself awake last night, but when trump took Florida and most of the swing states, I decided to call it a day/night. I was convinced that the USD devaluation was going to strip 20% off the US total GDP like the weak GBP did for the UK. After all, when I left, the EUR/USD was shooting higher and it was about 200 pips above yesterday´s low.

But this morning, it seems like the forex market has forgotten and forgiven whatever Trump might have said or done to upset the market. Now all that hate has turned into love, at least for the time being. Everything might change once the US session starts and the US traders enter the market, but for now, the relationship seems strong enough.

Imagine the negative sentiment that surrounded Trump all this time. The USD was heavily sold on any advancement Trump made in the polls during the campaign. Last week the USD was completely bashed for hundreds of pips after the FBI re-opened Clinton´s case and that continued tonight as well while Trump was advancing with real votes. Now that he has finally taken the White House, the market suddenly changed its attitude.

However, as we said above, the US traders are coming soon so they might turn everything upside down once again. Although, judging from the price action this morning, I can say that the doomsday scenario which many financial analysts (including us) predicted if Trump won, won´t materialize. If the market was to get rid of the USD, it wouldn´t wait too long to send EUR/USD to 1.15 at least, let alone reverse all of last night´s losses. That said, let's not rush to any conclusions and take everything one step at a time