Brazilian Real 20261023

USD/BRL: Anticipating Brazilian Election Results and a Liberal Party Victory

by with No Comment AssetsBehavioral SentimentBusinessCentral BanksEconomyEquitiesExclusive ContentFeatured HighlightsFinancial InstitutionsForexInvestingRisk ManagementRobert PetrucciSpeculatorsUncategorizedWorld

Flavio Bolsonaro Appears Set to Become the Next President of Brazil

Brazil will conduct the second round of its elections this coming Sunday on the 25th of October. Flavio Bolsonaro is predicted to win the election handily. No second place presidential candidate has ever comeback after the initial vote and beaten the first place finisher in the 2nd round of the direct elections which was implemented in 1989. 

Financial institutions appear to favor a Liberal Party victory over Lula da Silva’s Workers’ Party. If Flavio Bolsonaro wins the vote as expected on Sunday he will have strong coalition powers in the National Congress as a whole, including the upper house Federal Senate with conservative members that is expected to include 45 to 50 approval votes depending on the issue out of 81 collective seats. The USD/BRL closed yesterday’s trading near the 5.0525 vicinity.

Brazilian Real 20261023

USD/BRL One Year Chart as of 23 October 2026

Brazilian Real’s Performance Has Been Solid Since December 2024

The USD/BRL is traversing lower ratios that were challenged momentarily in early August, late July and saw sustained lower action in May of this year with depths touching the 4.9000 area briefly. The Central Bank of Brazil has leadership via Lula da Silva’s choice of Gabriel Galipolo as the Governor who will serve until the 31st of December 2028.

Financial institutions have shown faith in the Brazilian Central Bank as it maintained interest rates and did not succumb to the wishes of many from the Workers Party who had lobbied for a lowering of borrowing costs as inflation ran high. The USD/BRL has performed well since touching highs around 6.2500 in December of 2024. While the USD/BRL has been correlating with the broad Forex market to a degree, reaching the 5.2500 realm on the 1st of October, the Brazilian Real has shown more fortitude than the EUR, GBP and has done better that the South African Rand against the USD the past handful of weeks.

Geo-Political Implications of a Flavio Bolsonaro Victory

Optimism in Brazilian financial institutions regarding a government victory by Flavio Bolsonaro who is seen as pro-business (and certainly is not a socialist) is viewed as a positive by global investors too. The geo-political relationship between Brazil and other nations will be captivating if Bolsonaro wins Sunday’s presidential race. Brazil maintains an enormous trading relationship with China and its membership in BRICS is considered very important. These political relationships should be watched closely.

Brazil’s relationship with South Africa may also be tested quickly as Flavio Bolsonaro imposes a more conservative approach regarding his worldview. Bolsonaro is certainly an ally of President Trump. Brazil’s relationship with the majority of conservative leadership in South America will be dynamic and worth giving attention as it improves. The USD/BRL via behavioral sentiment could find itself testing additional lower values in the coming months. A free enterprise surge from Brazil will create a more vibrant economic landscape in South America, provided corruption is fought and transparency is delivered.

Cautious Global Markets as Optimism Engulfs Brazil

Cautious global investment certainly continues to create problems in equity markets. However, the Ibovespa Index of Brazil has performed exceptionally well the past year, even though it suffered a slight downturn yesterday it remains within sight of all-time highs. The results on the Ibovespa and the USD/BRL considering the predicted election outcome this Sunday will be important for retail traders to monitor.

Speculators need to keep in mind a Liberal Party victory has been factored into the value of both trading assets already, meaning some profit taking could transpire early until additional positive waves of enthusiasm engulf the marketplace…….and then eventually sees euphoria erode back into realistic outlooks and correlations with global mechanisms again.

Paying For Celebrations Via Profit Taking

Traders of the USD/BRL may want to pursue the currency pair in a speculative manner today and early next week, but they need to remain tactical and not allow overly ambitious targets guide their wishful thinking. Bias needs to be eliminated and USD/BRL traders should not indulge in leveraged positions which could get out of hand quickly if sudden sentiment shifts strike via larger players and financial institutions, particularly if they cash out winning positions (this to pay for some victory celebrations should the mood strike). The USD/BRL appears to be in a solid position to continue move lower via positive outlooks for business enterprise in Brazil, but traders should remain realistic and not step out ahead of the parade unless they have deep pockets and can demonstrate patience.

A Gap Higher Amidst Over-Exuberant Retail Trader Ambitions

Early Tuesday’s price action in the USD/BRL did see the 5.0000 realm come into sight, but an upwards wave developed and Thursday’s opening did produce a gap higher which tested values near 5.0575 momentarily. Yes, conditions appear ripe for exuberance to help the Brazilian Real become stronger against the USD, but retail traders need to practice risk management at all times.

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Iran, Oil and The Crumbling of a Criminal Dictatorial Wall

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Iran, Oil and The Crumbling of a Criminal Dictatorial Wall

Step aside for a moment from the conspiracy theorists and let’s consider that the U.S did not take out Maduro of Venezuela in order to facilitate more supply of oil. Let’s consider the possibility that Maduro was removed because he did not facilitate free enterprise and ran a criminal enterprise that did not favor the U.S.

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WTI Crude Oil One Year Chart as of 9th January 2026

Venezuela has the largest demonstrated oil reserves in the world, but the U.S has done rather well without it for years. The Trump administration’s move to take over Venezuela deters China and Russia’s influence in the Americas, while also putting another nail in the coffin of the Cuban regime. The word regime is used implicitly to point out that Venezuela, Russia, China and Cuba are all regimes of one sort via their one party ruling systems. Yes, you can argue the United State has returned to an imperialist philosophy, but that doesn’t mean it has dictatorial rule. Some will argue that point, I understand. But let’s step away from the complexity of political biases – including my own – and insights and discuss oil for a moment.

The takeover of the Venezuelan oil infrastructure, which has not happened in full yet via the U.S military action, does not mean U.S oil companies will make trillions of dollars from the adventure immediately. In fact a glut of oil is one of the potential consequences if Venezuela were to return to an open market system with its energy supply. Yes, the price of oil would in theory likely get cheaper. While it can be argued that this will help the U.S consumers, however many U.S producers of the shale oil industry would be put in a difficult spot. Producing oil from shale deposits requires hydraulic fracturing – known as fracking – and is an expensive endeavor. Cheaper oil from Venezuela in other words could put small and medium producers in the U.S out of business if supply becomes too ample

Now let’s turn our attention to Iran and the attempted revolution that is fomenting a reaction from the regime of that nation. Oil supply is certainly at stake for the world, but there is the overwhelmingly important possibility of allowing 90 million plus people to live in a system without repression. As of last night internet and telephone lines have been shuttered by the dictatorial government. There is a legitimate fear that many people protesting for their rights to be free now face the risk of violence and some have already begun to pay with their lives. Freedom is more important than oil for the people of Iran and Venezuela. It should also be pointed out that Venezuela and Iran are members of OPEC and this is likely not going to change.

The Trump administration is threatening military action against the Iranian rulers, but it is questionable how the regime of Iran could be overthrown by outside forces if there are not active combat boots the ground. While it may be possible to attempt a Venezuela like mission in Iran, that would be difficult at best considering the regime is already paranoid and on high alert. The civilians of Iran will have to do a lot of the work by themselves. Which means the populace of Iran will need to be able to organize and collectively topple a dictatorship, and this is unlikely to be done by handing out flowers. The regular army of Iran must disobey orders and the police must decide not to participate in violence against the protesters, allowing a seizure of power by the people.

At this juncture it remains difficult to say what will happen in Iran, except to say that there is likely going to be blood spilled. The Berlin Wall fell after decades of Cold War between the West and East. The wall of the Islamic Republic of Iran which was declared in the first week of April 1979 has nearly been running its dictatorship as long as the communists controlled Eastern Europe.

If and it is a big if, the Iranian people are able to topple the Islamic Republic of Iran it would be a game changer the world over. The complexity of the mafia style state that the current dictatorship has controlled not only in the Middle East, but throughout South America and elsewhere via influence with its proxies like Hezbollah is enormous. The dismantling of this network would take longer than the toppling of the Iranian regime. The world is unlikely to ever know in full detail the criminal activity of the current Iranian government and its proxies worldwide.

This is not about oil, it is about freedom. However, if the oil of Iran suddenly came under the control of a Western looking Iran that was unshackled, yes it would add to a vast amount of energy that the world already enjoys, but OPEC would find a way to manage the supply.

If Iran were to join the ranks of free nations and castoff its current leadership the world would benefit greatly. Only nations and proxies that gain from the exploitation of the Iranian dictatorship would worry. If the Iranian dictatorship falls there will not be paradise, but the event would be significant and transform the current state of global affairs.

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Broader Alliances: Sustaining Economic and Political Power

by with No Comment Featured HighlightsRisk AnalysisRisk Management

Broader Alliances: Sustaining Economic and Political Power

The following article is commentary and its views are solely those of the author.

If the United States decides to abandon its role as the premier global superpower and shall only be a Pacific and Atlantic power, withdrawing as defender of free seas, free trade and freedom in general, its democratic allies will have to start looking elsewhere for broader military alliances. This large group of nations would have to defend their interests against a revanchist China tied to Iran, Russia, North Korea and many of the Latin American countries – possibly including Brazil, and South Africa who have questionable politics and outlooks.

Eastern Mediterranean Alliance: A Strong Sea Power

Here is a speculative, yet reasonable look at the future of the free world. Let’s start with the Eastern Mediterranean where the two major powers are Israel and Turkey. One cannot deny that both these countries outclass all others regarding military might in the region. Israel’s air force is second to none and its navy is becoming a strategic necessity as it needs to defend its natural gas fields miles offshore. It now has six submarines that are capable of projecting power anywhere in the Mediterranean and even into the Indian Ocean and Persian Gulf. Turkey is currently a NATO member, but it is not clear that this will outlast the first half of the 21st century.

There is currently an informal alliance among Israel, Greece and Cyprus (both NATO countries) via joint military exercises and intelligence sharing. The Israeli navy and air force train regularly with Greece and its special forces train in the Cyprian mountains with its army. It would be in all three countries interests to formalize a treaty – if not of mutual defense, at least of mutual aid during times of war. All three of these countries are democracies and all three have mutual economic interests.

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A formalization of this alliance makes sense now and if there is a NATO collapse it turns into a necessity for Greece and Cyprus. Adding Egypt (although it would be the only non-democracy) to this group would only strengthen the alliance and keep Turkey at bay. A post-Erdogan Turkey that is comfortable with its Islamic character and its modern society could even join this grouping with Israel as a potential peacemaker between the historic Greek-Turkish rivalry.

This alliance without Turkey is a powerful force in the eastern Mediterranean, and this alliance with Turkey could neutralize a nuclear Iran. A Post-Hezbollah Lebanon which is in the interests of all of these alliance members (including Turkey and Egypt), could become a reality and another member.

A New Alignment: The United Border Nations

What about Eastern and Central Europe? Poland is rapidly becoming the major non-nuclear European military power. Within the next few years it will outshine Germany and the U.K and rival France. It is quite clear, nuclear weapons aside, Poland would probably defeat Russia in a number of weeks, if not days if a conflict were to ignite.

Whether the Russian-Ukrainian war ends in a Russian defeat or in some sort of face saving armistice, Russia will not lose its aggressive nature or nuclear capabilities and it will inevitably become aligned more closely with China and Iran because of its current political nature.

The important new alignment will be categorization of ‘countries bordering Russia’. A new alliance of Poland, Finland, Sweden, Norway and the Baltic states – Lithuania, Estonia and Latvia together would have the land, sea and air power necessary to deter and defeat, if necessary, any Russian imperialist expansion. Even with closer ties to China it would be difficult to imagine that, over the next 50 years, Russia would be a threat to this alliance. Adding Ukraine to this grouping would make a powerful force. Its joint population of over 100 million people, while not quite Russia’s 150 million – would be a formidable adversary, especially as the technological skills of these countries is first world and continuing to improve. Adding the other former Warsaw Pact countries like Czech, Slovakia, Romania, Moldova and Bulgaria can only increase its potency.

Unlike the Eastern Mediterranean alliance mentioned above, this would have to be based on a mutual defense treaty in order to properly deter any Russian-Chinese-Iranian attack. Linking up, informally with the ‘new’ Eastern Mediterranean Alliance would create a powerful grouping of free countries against any attempt by authoritarian adversaries. Adding an economic aspect to these border nations and an alliance with the Eastern Med group with free trade zones would create a strong challenge to any attempted Chinese hegemony.

Asian Border Nations Group: Potential Look Ahead at Potential

If we were to unite the Eastern Mediterranean and Border Alliances to an admittedly non-democratic Asian ‘stans nations, including Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan with a joint population of around 80 million, we are beginning to see the creation of a multi-cultural alliance that extends from the Arctic Ocean through Central Europe, Northern Africa and into Asia.

The Crucial Partner in Order to Balance Power: India

Which leads us to the Indian Ocean; a dominant India can help control the sea lanes from the Persian Gulf to the Bay of Bengal and down to Australia. An Indian-Australian alliance, along with Israel would create a democratic economic and military force that would keep China and Iran from dominating the region. This would require an Indian navy that is not only large, but effective also because it would hold a main responsibility for patrolling the seas from the Persian Gulf up to Australia strongholds.

As India also reaches its potential as a global manufacturing giant, it will be a force to be reckoned with. Including into this potent mix of nations, is the possibility of adding authoritarian countries like Saudi Arabia and the other Gulf states; along with Thailand, Myanmar, Malaysia and Indonesia who have strong ‘western’ economic interests and would create a formidable bulwark against China’s imperialist Belt and Road project.

Without the need to project naval power worldwide the Unites States could use it massive naval, air and ground forces to take better control of the Pacific Ocean along with Japan, South Korea and Australia.

If we add countries like the Philippines and Vietnam, then China would be deterred from further aggression. The only other region that would fall under American responsibility would be the Atlantic Ocean – the shipping lanes to Europe, West Africa and the Mediterranean. Along with the UK and France there would be no challenger to the control of the Atlantic. This could also lead to a revival of the old Monroe Doctrine and maybe free South America from the destructive influences of Iran, China and Russia.

The Global Economy and Free Trade Zones with a Stable USD as Reserve Currency

What does all this mean for the global economy? The free world along with its less than free allies who fear China, Russia and Iran could still maintain a U.S dollar based world. Free trade zones amongst and between the various alliances along with a revival of manufacturing led by a technology revolution using AI, quantum computing, renewable energy and space exploration could lead to a global resurgence of free countries that could stop the authoritarian appetites of Russia, China and Iran in its tracks. This can only happen with a stable reserve currency the ‘West’ can rely upon which is the USD.

Potentially a U.S freed from being the sole defender of freedom in the world, would help get America’s fiscal house in order and allow it to focus on being a dominant economic power. Is there a future for the ‘free world’ without a United States that projects power globally? Currently, a U.S withdrawal from global military assertion would certainly cause the end of freedom (economic and political) in the world for many nations. However, with the new alliances described above and a fiscally responsible United States, freedom could yet make a comeback.

Disclaimer: the views expressed in this article are solely those of the author, and not necessarily the opinions reflected by angrymetatraders.com or its associated parties.