Brazilian stocks jumped because polls exist. Bolsonaro polled better than expected in the first round. Markets reacted. This counts as analysis now.
Retail traders who spent the last month reading English-language think pieces about Brazilian democracy now believe they understand the Real. They do not understand the Real. They barely understand their own checking accounts. But they bought the dip anyway because a line went up and their portfolio is denominated in freedom units.
The runoff happens October 25th against Lula da Silva. That gives you three weeks to pretend you know what fiscal policy means in Portuguese. You will spend those weeks watching currency crosses and telling yourself this is research. It is not research. You are gambling on a country you could not find on a map last year.
Bolsonaro went from underdog to heavy favorite between Sunday night and Monday morning. The charts knew nothing about this. The moving averages did not predict it. The Fibonacci retracements sat there looking pretty and useless like always. But some guy's nephew in São Paulo read the vote counts and bought stock index futures. That information took six hours to reach Connecticut.
By then the move was over.
Technical patterns do not care who wins elections. A bull flag does not speak Portuguese. Support and resistance levels were drawn by traders who think Brazil is the country with the rainforest and the other stuff. They will hold these positions through the runoff. They will check their phones every morning. They will feel like geopolitical strategists.
Then they will get stopped out on a random Thursday because the central bank said three words nobody translated correctly and the entire thesis evaporates before lunch. The charts will still be there. The trendlines will not apologize. And some f*cking guy in Milwaukee will buy the next dip because the RSI looked oversold.
Photo by Matheus Câmara da Silva on Unsplash
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