Yesterday, there was a long-awaited presidential debate between Hillary Clinton and Donald Trump. What could this event bring for the gold market?

The first presidential debate is behind us. For us, it was a poor show, since both candidates did not say anything new (Trump reiterated that we should reject harmful trade deals, while Clinton called for more inclusive growth). And we could hear hardly any substantive comments, as insults and interruptions dominated the scene. However, our opinion does not matter. The opinions of gold investors matter. Surprisingly, investors believed that Clinton had won the debate, as the Mexican peso rose, while the price of gold edged lower. We wrote “surprisingly”, because all polls but CNN’s showed that Trump had won the debate.

Now, the question is whether the debate will affect the election polls. According to RealClearPolitics, Clinton led in the polls by 2.3 percentage points before the debate. We have to wait for the next round of election polls to see any impact. Our bet is that Trump’s chances are likely to rise. Why? Well, he seemed less scary, as he generally showed that he could control his temperament. Therefore, he could attract some undecided voters or people who were persuaded by Clinton’s team that Trump is a fascist monster.

Summing up, the first presidential debate is behind us. There were some interesting moments (like Trump’s reference to Clinton’s deleted e-mails in response to the question why he did not release his tax returns), but generally it was quite boring. Trump did not point out some of Clinton’s scandals, but managed to present himself in a less scary light. The price of gold dropped as Clinton has been seen as victorious by investors (contrary to online polls), but the move was rather muted. However, the next round of election polls could bring a rise in Trump’s odds. Such a scenario should support gold prices (because investors see Clinton as the candidate of the status quo), however, the impact would be rather limited.

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Disclaimer: Please note that the aim of the above analysis is to discuss the likely long-term impact of the featured phenomenon on the price of gold and this analysis does not indicate (nor does it aim to do so) whether gold is likely to move higher or lower in the short- or medium term. In order to determine the latter, many additional factors need to be considered (i.e. sentiment, chart patterns, cycles, indicators, ratios, self-similar patterns and more) and we are taking them into account (and discussing the short- and medium-term outlook) in our trading alerts.

Thank you.

Arkadiusz Sieron
Sunshine Profits‘ Gold News Monitor and Market Overview Editor

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