In 2016 Trump was not really expected to win and therefore Equities (SPX) were "On their knees" going into the election falling 5% between mid-August and 04 November when they hit the 200-day MA...they then "tore higher" in the months following
2020 was not that different (price action) as again equities retraced lower sitting almost 10% off the early Sept highs leading into the election (although the covid dynamics have to be filtered in here and the massive stimulus that was kicking into the economy.) Again, post the election we saw the equity market move sharply higher in the following months.
Potentially two classic examples of "Sell the rumour and buy the fact"
This time around we already had our 10% correction lower in July August and have already rallied nearly 15% since the 05 August low. That is "coincidentally the day that Kamala Harris became the Democratic nominee for President.
Are we already seeing the "Trump trade" in play? Does that open up the danger of "Buy the rumour, sell the fact" this time?
Even If it does it does not suggest that you sell yet as the "Polls" seem to be moving more favourably towards Trump in recent weeks.
However, IF we are at or close to the highs in this move going into the election (exact opposite of 2016 and 2020) then it might be prudent to head to the sidelines and watch the initial post-election price action.