USD/BRL should provide speculators with a real Forex betting environment today; this after Lula da Silva seemingly won the vote for Brazil’s president.

USD/BRL entered the weekend near the 5.2959 level this weekend, ahead of yesterday’s Brazilian elections which saw Lula da Silva win. Notably, on Friday, USD/BRL did indeed see some selling action emerge. This voting result creates a doorway for today’s early price action that will certainly produce a gap at the open.

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The question for speculators is which direction USD/BRL will move in the first hour of trading today. While the left-wing Lula da Silva party won a hotly contested presidential race against Jair Bolsonaro, it was actually Bolsonaro’s political party that won a majority in Brazil’s Congress and this will create strong opposition to the s they do not agree with the legislation proposed by the president. .

Technical charts will be important, but reaction and behavioral sentiment will be critical

Curiously, Friday’s slowdown with a bearish pull at the start of the weekend could be a sign of things to come with USD/BRL. While financial institutions may not be happy with a victory for leftist Lula da Silva, strong political opposition in Congress means economic policy may not be able to stray too far from the center, which could create more calm than expected for the USD/BRL in the short term.

  • A rather volatile open for USD/BRL should be expected today, traders with no open positions may want to wait an hour while monitoring early price action to let the Forex landscape calm down.
  • The 5.2600 support ratio should be seen as a strong lower area if the bearish sell builds and traders can look for reversals to the upside. A move above the 5.3700 area above may be considered too high a value by technical speculators.

Jerky trading is expected with the possibility of betting on a short-term direction

Today could turn out to be a “classic” day for Forex trading on USD/BRL as financial institutions react to the Brazilian election result. Many days are ahead for the potential for economic policy to create a storm for USD/BRL, but in the short term balance can be quite difficult to find, which can produce some rather toothy conditions. saw.

Traders should be able to take advantage of volatility and bet on the upside when support levels flirt with short-term. Lula da Silva got a win and in the medium term this should not strengthen USD/BRL. In the short term, it is likely to help speculators take advantage of potential reversals when support levels have proven to be sustainable.

Short-term outlook for the Brazilian real:

Current Resistance: 5.3160

Current support: 5.2824

High Target: 5.3790

Low target: 5.2620

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