Marine Le Pen and Emmanuel Macron are leading the polls in the first round of the French election! What can we learn from the OANDA French election outlook? The broker has analysed the scenario of Le Pen vs. Macron.
23 April, AtoZForex – The unity of the Eurozone is at risk, due to the political uncertainty in Europe. After the Brexit, US election, now the far right wing leader Marine Le Pen is leading the first round voting polls. Some analysts believe that the bloc currency could drop to $1 or below, if Marine Le Pen becomes the new president.
AtoZForex.com’s team has been contacting and interviewing Forex brokers internationally, with the aim to get their view on the market ahead the French election. Furthermore, we have received inquiries from our readers about the brokers’ risk management precautions. Following up with OANDA, below I have summarized the key highlights of OANDA French election outlook. Along with the comments of Dean Popplewell, the Vice-President of Currency Analysis and Research of OANDA.
OANDA risk management measures
Kristina Frunze: “Has OANDA raised margin requirements or changes its leverage levels? If yes, until when?”
OANDA‘s research team: “To help ensure our clients are more insulated from such movements, we will be temporarily lowering the maximum leverage from 100:1 to 50:1 available on the following instruments:
- All EUR pairs currently at 100:1
- Germany 30
This leverage change will be in effect during; market close Friday April 21 to Market open Monday April 24 9:00am EDT (2:00pm BST). But, also from market close Friday May 5 to Market open Monday May 8 9:00am EDT (2:00pm BST).
As a result of this change, traders may need to close trades. Add funds to their account or risk a possible margin close out if traders currently have an open EUR position or Germany 30 with higher levels of leverage, while do not have enough funds in their account to cover the increased margin requirements.”
OANDA French election outlook: Le Pen vs. Macron
Kristina Frunze: “Dean, what is your projection for the second round of the France election in May 2017? Also, what is the impact on EUR?”
Dean Popplewell, OANDA Vice-President of Currency Analysis and Research: “Our previous baseline scenario that Le Pen would race versus Macron has become more likely. As the current Polls show that these two candidates are neck and neck.
French election First round polling averages per candidate (Source Telegraph.co.uk)
In the second round on May 7, Le Pen is unlikely to significantly increase her support beyond her base, and voters of the moderate left and right are expected to merge around Macron. Current polls show him winning by margins of around +25%. This is probably the markets preferred outcome, which should be a plus for the EUR (€1.1000’ish) and have Bund yields unwinding the past months risk premium rather quickly.”
Risk disclaimer of OANDA
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
Do you have questions related to the OAND French election outlook? Let us know in the comments section below.