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The uptrend was expected to continue as the pair was seen to bounce back from the pitchfork’s lowest support level. The pair slides lower in the last few days as the inauguration of the far-right Jair Bolsonaro as the new Brazilian president, was expected to test its relationship with the rest of the world. Dubbed as “South America’s Trump”, Bolsonaro was planning to lead the Mercosur agreement, the largest in South America, and isolate the continent to promote their own interest first, a mimic from Trump’s “America First” policy. The European Union was trying to flirt with Brazilian president Jair Bolsonaro to prevent another isolation, as South America is shifting from Democracy to Authoritarianism. Brazil was seen to be the champion with the recent trade war between the United States and China, with China importing 80% of its total soybean import from Brazil. The two countries decided to enter a 90-day truce that will last until March 01, 2019. Histogram and EMAs 13 and 21 will continue to fall down.
The pair was seen to further go lower in the following days to complete the “Head and Shoulder” formation. As Jair Bolsonaro take oath to become the new president of Brazil, he promised to make Brazil great again, a mirror of Trump’s Make America Great Again campaign. After taking the office in three (3) days, President Bolsonaro said he was open to discussing future US military base in Brazil, underlining his stated desire for closer ties with the United States. He told US Secretary of State Mike Pompeo that he is aligning Brazil with the US by expressing hostility to Chinese investment in Brazil. The trade war between the United States and China had seen the former to shift its import to Brazil, which accounts for 80% of the total Chinese soybean import. However, Brazil’s National Security Adviser Augusto Heleno said the Bolsonaro had not offered to host a US military base in Brazilian soil. Experts see this backsliding due to opposition from Brazil’s Armed Forces. Histogram and EMAs 13 and 21 will continue to go down.
The pair was expected to continue the upward channel after hitting the support line from MA 50. As Noway continues to defy the European Union by suggesting that the United Kingdom should do a “Norway-Plus Brexit”, the EU was seen to impose more authority within the bloc and with countries having trading relations with the European Union. The rising populism in the European Union had pushed the European Commission, the EU’s executive arm, to tame their behavior. The European Union, under European Commission’s command, pressured Italy regarding its budget deficit, gave deadline to Switzerland over integrating its stock exchange policies towards EU’s policies, suspended EU’s payment to firms owned by Czech Prime Minister, and warned Hungary and Poland to face consequence over its anti-immigrant stance. Histogram is already showing signs of future reversal, and expected EMAs 13 and 21 to follow.
The pair was expected to break down of the “Descending Triangle” formation. Despite efforts by the European Union to tame the rising populism over the bloc, Investors and Traders are worried that the EU might not be able to handle this issue, which will further widen the gap between the East and the West. Most of the far right countries in the European Union are members of the CEE (Central and Eastern Europe), which are seen to pivot to China. The European Union’ trading bloc comprises 1/3 of the Global GDP, and a division between the East and the West will hurt the EU’s economy. Aside from these, the European Union’s de facto leader and French President Emmanuel Macron were falling out of favor as he was seen to be a weak replacement to German Chancellor Angela Merkel, who single handedly hold the entire European Union during crisis’. Angela Merkel was considered as the most powerful woman in the world and a leader of the free world. Histogram and EMAs 13 and 21 was expected to fall.