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Macro Monday 57 - Venezuela Update ( 5 charts)Macro Monday 57 - Venezuela Update I'll have more charts for you over the coming week but feel this is an important event that could help shape South America's economic trajectory over the coming 5 - 10 years Last week I shared the country that has the largest oil reserves in the world, Venezuela. I noted that Venezuela stands at a critical juncture, with the potential for a historic return to democracy by way of national election on 28th July 2024. Unfortunately, the authoritarian socialist incumbent President Nicolás Maduro appears to have "claimed" victory in the election, amidst many observations of election fraud and interference. At present the people of Venezuela have taken to the streets in protest, are toppling Maduro's statues and demanding him to leave office. Only an hour ago reports of counter forces apparently breached a barricade to Maduro's home. Many world leaders have called out Maduro on what they see as a false election victory. The international pressure is mounting on Maduro's régime. The world recognizes the violation of the peoples choice. The election might look like its a major loss for the people of Venezuela, however it appears to have invoked an incredible revolutionary type response from the people, it has captured the worlds attention, and the attention of the likes of Elon Musk and Javier Milei (Argentinian President) both calling for Maduro's exit. In response Maduro has called out Elon Musk, whom he calls his "arch-enemy" since his post earlier today. Clearly threatened, pressure is mounting on Maduro internally and from the International community. The election results could be the tipping point for the Venezuelans , it appears that change is in the air in and a new dawn is approaching with the world backing the Venezuelans who have clearly had enough. Lets hope for as peaceful a transition as possible. If successful, the country with the largest oil reserve in the world, that was once twice as rich as China, 4th ranked world economy (1st in Latin America), can return to its former glory. If such an event were to unfold, Venezuela, IMO, could lead South America out of a developing economy to a booming one within the decade. Charts in South America Please see South America and all its compressing pennant formations and ascending triangles. Few cup and handles too at present Peru is a clear leader with Argentina, however it does not hold the worlds largest oil reserve like Venezuela which appears to be about to make major political change. Chile - AMEX:ECH Brazil - AMEX:EWZ iShares Latin America ETF - AMEX:ILF MSCI Peru NTR Index (USD) - ICEEUR:MPU1! Argentina - AMEX:ARGT PUKA
ILong
by PukaCharts
Latin America - the multiyear perspectiveJust by chance, the Latin America ETF (ILF) was noted to be doing very well this week as the S&P500 and friends are given a beating. In a bigger picture perspective, a descending triangle has been formed in the last 12 years. While the upside to resistance may be smaller than previously, it is also projected that IF and WHEN there is a breakout, Latin America would do a multiyear climb to 2.5X of what it is today. Technicals are just turning around, including a very bullish weekly candlestick last week, with MACD turning bullish. Overly optimistic or an amazing opportunity? I am not well versed in emerging markets, particularly Latin America. Do share your thoughts...
AMEX:ILFLong
by Auguraltrader
3
I'm buying weakness in Chilean stocksAfter the IPCC's recent report showing that the North Atlantic Current may be on its last legs, I decided that I needed to diversify away from the US and Europe a bit. (If the North Atlantic Current fails, it would cause massive, disruptive climate change for Europe and North America.) So I committed to look for opportunities in some country ETFs. The one I've been buying is $ECH, the iShares Chile ETF. Chile stocks are beaten down because of currency weakness amid heavy pandemic spending, but honestly their debt-to-GDP ratio is still one of the world's best at just 27%. (Contrast the US at 107% and Japan at 238%.) Chile has had a highly effective vaccine rollout, with the world's sixth highest vaccination rate. (With 67.2% of Chileans fully vaccinated, they lag behind a few much smaller countries, like Malta and Iceland.) Thanks to pandemic UBI and a high vaccination rate, Fitch yesterday raised its 2021 real GDP growth forecast for Chile from 6.1% to 8.3%, making Chile one of the world's fastest growing economies this year, trailing just behind China's 8.4%. But whereas China ETFs trade at 14x cash flow and yield 1.1%, $ECH trades at less than 5x cash flow with a distribution yield of 2.34%. There is, undoubtedly, some political risk when buying a Latin American ETF. Latin America is notorious for its political instability, and Chile is no exception. Chile currently ranks 19th in the world for economic freedom, and its current leader is a Harvard-trained economist and business engineer. But he's also wildly unpopular due to excessive use of force against protesters the last couple years. The country is currently in the process of drafting a new national constitution, and many of the constitutional delegates lean left. It remains to be seen what shape the future government of Chile might take. Despite the uncertainty, the immediate future for Chile looks relatively bright. At this valuation and with this GDP growth rate, I've bought a modest stake and plan to hold for the forseeable future.
AMEX:ECHLong
by ChristopherCarrollSmith
4
#DESP 1W- LONG TERM HOLD / LATIN AMERICAN UNICORN.Despegar.com, Corp., its an online travel company that provides a range of travel and travel-related products through its websites and mobile applications in Latin America. The company operates through two segments, Air; and Packages, Hotels and Other Travel Products. The company offers airline tickets; travel packages, hotel rooms, car rentals, bus tickets, cruise tickets, travel insurance, destination services, and other travel-related products, which enable consumers to find, compare and purchase travel products through its platform. Market cap: 1.025B It almost redundant that most affected companies by COVID-19 lockdowns and restrictions were travel, hotels airfreight firms. Since Feb 18th to March 23th of 2020, its price sink by a -71%. Beside this massive hit, lockdowns were translated into less billing and then, into less earnings per share. DESP missed all earning estimates from 2020Q2 to 2021Q1. A sector that is completely devastated, but now showing some sings that reach its bottom. With the re-opening of most of Latin American economies and vaccination moving forward, tourisms might rise again on last two quarters of the year and in 2022. Technically, DESP its doing quite good since the dip in March 20''. A really long term trend has been broken and a new uptrend has been confirmed. Now, we are on a turning point, were price must overcome 14.70 level. Fibonacci extension shows our first target at 16.94 (+17%) and I believe that its highly possible to reach a 21-22 level (+49%)by Q4 if balances sheets start to showing some improvements. I am already in a position since 12 USD, but I´ll open another position if price reach a 15-16 level, setting my stop loss at 13.5 Stochastic Oscillator its looking great with a possible K/D cross right now. Stochastic its showing a little divergence from January to middle march, but I think that its already discounted.
NYSE:DESPLong
by aoberninger
#MELI - 1H - 13.11.2020 / Latin American Amazon. MELI BACKGOUNDS MercadoLibre (MELI) is an online e-commerce and payments platform. It operates through the following geographical segments: Brazil, Argentina, Mexico, Venezuela, and Other Countries. The company provides users a platform for buying, selling and paying.  Born in 1999 and founded by Marcos Galperin, its the largest ecommerce company in Latin America. - Exponential growth since 2016. - Boosted by the rise of ecommerce this year due to COVID-19. - Super Strong Fundamental indicators. - Amazing revenue over 2019 - 2020 beating all estimates. Even though MELI is a direct competitor of huge ecommerce companies like Amazon, eBay and Shopify, they operate on a total different market. Quiet similar to Jumia in Africa. Latin America is a huge market full of opportunities where Amazon left spaces that MELI took advantage of. Now, MELI is standing strong and keeps investing heavily to maintain its dominance. Last week was authorized by Brazil Central Bank to operate as a financial institution. Although MELI its an Argentinian company, now its focusing on BRAZIL (209 million people market) and MEXICO (120 million people market). It´s Payments platform MercadoPagos, is a Fintech Payment solution that it is getting adopted massively by Latin Americans. It aloud all kind of business B2C to charge without cash or just transfer money between people. It´s e-commerce platform, operates at a 12 transactions per seconds and 80% of the total sales are from Brazil, Argentina and Mexico. Last quarter revenue jumped to $1.12 billion from $603 million, exceeding analysts' projection of $984.8 million. Unique active users surged 92.2% to 76.1 million, while gross merchandise volume jumped 62.1% to $5.9 billion. With a 64.792B market capitalization, and huge growth potential, MELI is just on initial stages of its history.  This is the kind of share that you might regret on a near future of not buying it earlier. TECHNICAL ANALYSIS.  (1H) Nothing left to say but MELI is on an uptrend basically since February of 2016. I particularly like to analyze it on a 1H timeframe to see how respectful this stock is of supports and resistances of this year.  We´ve got three supports near current price level. Uptrend + MA200 + Fibonacci 0.618. I think that we might see a little test on Fibonacci´s 0.618 and then next stop is all time highs. I would be careful and wait this confirmation before go long. Would be wonderful to close next week above Ichimoku´s red cloud.
NASDAQ:MELILong
by aoberninger
2
The "Future of the Gas Station? (Latin America)The "Future of the Gas Station”? (“Christ the Redeemer of Oil?”) One of the most beautiful (UNBELIEVABLY beautiful) and largest “mega cities” in the world which is also named one of the New Seven Wonders of the World is (in) the city of Rio de Janeiro. Perhaps the only other mega-city “city” on Earth that can come close to matching the natural amazing cliffs and crazy “year round” beautiful beaches of Rio de Janeiro is “Hong Kong” (there are many secret cities around the world that are better then Rio de Janeiro or Hong Kong for example along the Perl River or along Southern China or maybe someplace else hidden on Earth?) However, many larger cities are much much more expensive (Rent in Hong Kong for example is about 600% higher then in Rio de Janeiro and food prices in Hong Kong are are about 200% higher maybe even more if you dont trust the numbers??) Interestingly perhaps the “largest ever” oil corruption and fraud charges in the ENTIRE HISTORY of “ALL” of Latin America was quite recently (and is still going on to this day at least from the Brazilian stock market BOVESPA index’s perspective??). This was a major lawsuit that started at some “Gas Station” outside of Rio de Janeiro Brazil and centered around one of the largest oil companies in the world. At least 11 different countries where involved in the lawsuit for "corruption indictments" (even the United Stated SEC made off with $10’s of millions of dollars (cold cash) from this case?), at least 18 different companies where involved and 400+ people (criminals) involved with many going to jail for anywhere between 10 to 30 years of jail time and by some estimates something like R$6.2 billion (USD$2.5 billion) (which is about equivalent to price of construction of 10+ off shore oil rigs?). Even the president of Brazil was sentences to jail for 9 years and went to jail for about one full year+? What makes Rio de Janeiro especially beautiful and “amazingly religious” is a 600+ “ton” statue of “Christ the Redeemer” shining with “hands stretched open” above the mega metropolis of 10+ million people. The statue of Christ above Rio de Janeiro is truly one of the most amazing religious concepts that any modern megacity on earth lives and works under. The statue of Christ is so big and so fundamental that two thousand years from now it might still be there… it is a 600 ton god statue?! Perhaps its more often then we realize in Europe and North America, but religion is and has a very important key to Latin America (and many other cities on Earth). However, for Rio de Janeiro “god (apparently) is the key”? The giant statue of Christ the Redeemer atop Corcovado mountain looking down at everyone happens be one of the most stunning and most “godly” and fundamental religiously famous landmarks of our Earth? It one of the “wonders of the world?” One of the interesting things about the oil industry is that there is a lot of “suspicion” that everyone involved “maybe” is making a “ton” of money. Many people suspect the oil executives of being a type of “cult club”. Its possible that the corruption charges against Petrobras are “very complex” and even “creatively created” by a mastermind who understood the legal system and that they might have to “go to jail” just to convict everyone of what they are doing wrong anyway. In a lot of ways the (socialist “working class”) president of Brazil learned a very very important legal lesson after spending one year in jail and “getting out” and being “set free” after even contacting the United Nations Human Right Commission. The corruption maybe was with the legal system itself.. the judges? and Petrobras maybe wanted to see the Judges go to jail in addition to the president? However, the president was “popular” especially with labor activists and was eventually set free. The president was convicted of “money laundering” and “passive corruption”, defined in Brazilian criminal law as the receipt of a bribe by a civil servant or government official. Lula was sentenced to nine years and six months in prison and only served about one year. However, the president learned a very very important lesson about “doing things legally correctly” and maybe will even run for president again? (see many articles of news on this topic) So how does the “oil mafia” really work? How do we know if there really is such a thing as a “oil” corruption (problem) and how does this all actually work and do people really go to jail and get “busted”? What about the police operations in Brazil did they want some of this “oil” money too?? What was this Brazilian “Operation Car Wash?” And most importantly what can we do about all this? (for everyone!?) Whats the suggestions for Petrobras’s Future and the future of “oil” in Latin America? In the oil industry and in “big-time” obese operations world there is a term called “downstream”. Some companies get so chubby that they essentially dont need any of there sales stores that they actually sell their products in… in the oil industry a lot of companies “don't need gas stations” anymore so they “spin off” what is called their “downstream assets” and basically the gas stations are no longer part of the company. This allows for some “corruption”? However, there is good and bad sides to this, it makes it easy to “own a McDonald’s or Petrobras Gas Station franchise” but difficult to do anything “differently” or create “unique competition” with the financiers (the people with all the money) or the people that gave you the money at the top get “lazy” and want even more money from the Gas Stations. The law is typically behind the “money” and not the people who own and run the businesses day to day. A lot of these people are not use to “dealing with the legal system”. However, what happened in Brazil’s Oil Business was that someone working at a “gas station” might have “purposely” tried to “go to jail” just to get Petrobras “media light and attention” and then the real problem was actually something more “fundamental” to franchising and just being “reasonable”. The problem “with” Petrobras actually has to do with something called “franchising” and how gas stations all over the world really work. Imagine two possibilities a world where “everything is run by big oil business” or a world where there is a lot of independent smaller business. The problem is we need both and both sides say we only need that side. However, what if the problem is with wealth is maybe something “gravitational” or “universal”? Is there fundamental problems with ALL of capitalism? In the Communist Manifesto written by a Eastern European named “Karl Marx” believed that capitalism contained the seeds of its own destruction. He described how the wealth of the bourgeoisie depended on the working people (just like the people who actually work at these Petrobras McDonald (only franchise) Gas Stations) ... Eventually the proletariat (gas station worker) would lead a revolution against the bourgeoisie (Petrobras). The final struggle would lead to the overthrow of capitalism itself. Because the businesses (got too obese and fat) (and the governments that regulate them too) would just get too big and too powerful. For more then a few hundred years capitalism has hidden behind democracy… but what if? What if there was something really wrong? With both communism and capitalism then what? (we will not discuss that here.. however, there maybe some new political revolution needed that isn’t socialism, or capitalism or communism)? The art of franchising and “gas station-ering” maybe needs a “global overhaul”… the secret maybe isn’t in “more franchising” but allowing “greater freedom” and allowing independent business owners essentially to start their own unique businesses. And when we leave earth that all will get even more complected (this is the “transport” industry?) There are many detailed videos on corruption and “operations carwash” and it may help to hear what others have to say about this problem of “franchising”. Part of the key to understanding both sides of “real corruption” to understand “both sides” and even look into helping both sides solve those problems. It maybe that both sides wanted good? Even the Brazilian military “discovered” the problem in the first place? The head of Brazil's army wanted the president “behind bars”? and the New York Times even claimed "Brazil’s democracy is now weaker than it has been since military rule ended".. however, maybe the truth was different? Hope this helps you! Asher :)
NYSE:PBR
by idasuperman
Exotic Post Modern "American" Currency?The success of "North American Currency" is interconnected with Exotic Post Modern "Latin American" Currency? What is the future of Latin America Currency as a whole? Latin American Currency or “Cash/Money” is by many standards some of most complex and significant “Exotic Currencies” on Earth. South American, Central America and the Caribbean include many independent countries all stabilizing (by decreasing the value) of their own independent and yet interconnected currencies. Currency in Latin America is perhaps the most isolated from Asian, European, Middle Eastern and even Africa and yet most closely affiliated and coordinated and mysteriously dependent to the United States Dollar. If the currencies in the “far east” are “exotic” then the “far west” is Latin America and its “jungle of currencies”. The total gross domestic product of Latin America is about 5 to 10 trillion $USD or about ½ to ¼ the size of the United States Economy. The average person in Latin America makes about $10,000 per year. There are three main modern accounts of “Latin American Currency History”. By “modern” we mean post-indigenous currency. The first being “post-indigenous” or “pre 90’s or 2001 a currency Odyssey” era, the second being the GREAT NEO-LATINO AMERICAN STABILIZATION PERIOD roughly mid 2004’s to 2014 a time when South America was becoming more valuable then North America in terms of respect for foreign currency. The final era is now (in the graph). The real problem is the Modern Erotic Latin American “Inflation Era” an Era that has seen “unbelievable Latin American inflation”. This started around 2014 and effects all of Latin America to this very day. The primary Latin American Currencies are: BRL: Brazilian Real: The “most valuable” and yet peculiarly unstable currency in Latin America. ARS: Argentina Peso: One of the most stressful currencies on Earth loosing about ½ its value sometimes each year for years and years in a row (10+ to 20 years). Going from 1 to 1 with the $USD dollar to nearly 60 to 1 with about 6000% inflation over 20 years. The rest of Latin America maybe has no idea “how poor” and how much financial trouble Argentina is really in. CLP: Chilean Peso: The Latin currency playing with a “historical financial sideline” a long time running back (promoting) “low value” currency with a “richer chilean latin” lifestyle. MXN: Mexican Peso: Surprisingly the most “central” currency in Latin America. Not valued too much above or too much below any other currency. Every other currency is either “a little” above or “a little” below the Mexican Peso at 25 to 1. Mexico’s un-official exchange rate is “1 to 1” with the rest of Latin America and 25 to 1 the “highly-developed” North American World. The Mexican Peso makes it “surprisingly” easy to understand all the other currencies since its currency is “about the central or average or median currency”. COP: Colombian Peso: One of the most important currencies in ALL of Latin America. An “explosively valuable and geographically momentous and philosophically important latin currency”. The “COP” is strategically important because of its close connection with Panama and Central America and also the “frontier of the Amazon jungle” and the only country in all of latin America that is connected to both the Caribbean and Pacific Coast and “indigenous” latin culture. A COP currency is valued at 4000 to 1 and as a result of its “low value” raises the “natural value” of ingenious life and “real food” and also increases the general “hate” of “fake money”. Many of the people in North West South America (Venezuela, Columbia, Peru, Ecuador are very independent “hight jungle” or “high mountain attitude” and have even relied on “drug” currency. Cocaine is accepted as a “natural viagra” similar to legalized marijuana or cannabis in North America and Europe. This region is a “geographic pivot” and a complex currency. CRC: Costa Rican Colon: The Center of Central American Currency. Most currencies that are geographic centers around the world also become the “middle” or “average” currency with their two neighbors on either side being balancing currencies. So in Central America the “exchange rates” fluctuated in the “middle” if you are in the middle or the middle of Central America. Rather then “forcing” a 1 to 1 with the far far they simply peg the value of their currency to their neighbors which creates a “natural currency stability” or have a “fixed inflation” where they decrease the currency by a specific value (meaning a specific number of “pesos”) each year “on purpose” relative to another currency. PYG: Paraguay (Guaraní): The most “worthless” currency in all of South America and also “the official center of official trade and real geographic center of South America”. 6000 to 1? Paraguay has “officially” helped all the other neighboring currencies in South America by “showing off what not to do”. Paraguay has been the least valuable currency for several decades. Can you imagine paying several THOUSAND for a coffee and police with actual machine guns on every block with no one in the street? PEN: Peruvian Sol & GTQ: Guatemalan Quetzal: The Indigenous Currency “Heart” of Latin America is surprisingly one of the most stable and even more valuable currencies. JMD: Jamaican Dollar: One of the most “independent” currencies in the Caribbean and a very important currency because it “floats a lot!” UYU: Uruguayan Peso: For the first time in “history” the Uruguayan Peso is worth more and “trusted” more then its larger neighbor Argentina. Perhaps Uruguayan currency is the “once savior” of Argentina. Starting in 2018 the Uruguayan Peso was worth more then Argentinean Currency. DOP: Dominican Peso and HTG: Haitian Gourde: Two of the most complex currencies in Latin America. Back in 2004 the Caribbean had some of the most important changes to its currency value in *all* of Latin American Currency history and Haiti and Dominican Republic are at the center of the “wild windy” “currency hurricanes” in the Caribbean. Many of the currencies in Latin America do not follow traditional exchange rate rules or “common law” of 1 to 1, 10 to 1 or 100 to 1 or 1000’s to 1. In fact most of the Latin American Currency do not follow any “normal philosophical dealings” of “base 10”. Instead, Latin America has an entirely different “exotic exchange rate” that isn’t on a “base 10” system like in Asia making Latin American Currency “oddly” a floating social latin currency class. Currency in Latin America varies around mostly around “25 to 1” (Mexico) but also varies at 5 to 1 (Brazil) or 2 or 3 to 1 to 1 or 6000/4000/858/625/133/90/60 to 1. Unlike the European Union there is no central latin American banking system or “latin peso like the euro” in Latin America. Its likely that a “united currency” would likely “help stabilize the United Stated Dollar” because of it would be at first competitive with North American Currency and then maybe even be more valuable then a North American Currency. Today Latin American is a Currency “jungle” of modern exotic currencies to “learn from”… Hope this helps! Asher :)
by idasuperman
Colombian Peso under Pressure The Colombian peso has been making headlines lately. There are calls of Colombia to dollarize amidst some expert calls that the COP might be overvalued by as much as 30%. This chart is an update to my last year's chart that correctly forecasted the current price range in the usdcop pair. According to this chart, continued dollar strength and a weak cop could see prices rise by 30% $4500 once we break the key $3500 level. -- El peso colombiano ha estado en los titulares últimamente. Hay llamadas de Colombia a dolarizar en medio de algunas llamadas de expertos de que la COP podría estar sobrevaluada hasta en un 30%. Este gráfico es una actualización de mi gráfico del año pasado que pronosticó correctamente el rango de precios actual en el par usdcop. De acuerdo con este gráfico, la fortaleza del dólar y un policía débil del cop podrían ver los precios aumentar en un 30% a $4500 una vez que rompamos el nivel clave de $ 3500.
by You23
USD/Latin American currencies poised to reboundWe have in Red (USDBRL) and Orange (USDCLP) the two strongest currency in latin american recovering from recent devaluation in a pronounced way in comparison with Dolar Index (Green). But fiscal situation in Brazil is getting worse, the political problem after impeachment of last president is to approve a series of bills to cut social expenditure like Health and Education, while continuing rolling over debt. Debt-to-GDP ratio is getting to 70% this year, in 2014 it was 55% showing significant deterioration. While Business Confident Index (BCI-OCDE) improved this year, I have no reasons to believe it will last, in my vision is more related to a psychological vision that impeachment will bring structural changes, but the new goverment don't discard raise taxes. In Chile (USDCLP) on the other hand, without impeachment, has the worst BCI in the world right now. showing the profound crises Latin American is facing. With all the majors countries in crises Mercosur business is stagnated. Time to LONG Latin American Pairs. Sources: Debt-to-GDB Brazil: BCB 2016 BCI-OCDE: data.oecd.org
Long
by AlexandreZaire
3
RunningAlpha Upgrades Commodity Markets Update to Priority ListRunningAlpha dot com Capital Markets Intelligence High Priority Update for Monday, May 2nd, 2016 Although $39 and $36.50 remains baseline intermediate to long-term support for Light Crude Oil ( in reference to June Contract Pricing ), the recent advance upwards has opened the door for a further short covering rally upwards to $62 to $65, and perhaps $74 to $76 levels if on a spike. Bullish window for buying on dips extends into at least June period -- this also applies to Brent Crude. Russian Stock Market ( $RSX ) looks bullish during this period. Oil and Gas Drilling stocks will likely continue higher on balance -- particularly a core position in stocks like $PBR.A would be sensible, which should also benefit from a continued bullish run in Brazilian Equities ( which I expect Brazilian equities should trend higher into the summer, and again later in the fall to close out the year much higher ). Among many other equities in Latin America, $ARCO and $KOF also have a strong bullish bias with sentiment conviction windows extending into foreseeable future. Other Commodity Markets showing very significant sentiment strength going forward are in the Agricultural complex -- Soybean, particularly Soybean Meal $SOYB, Rice, Corn $CORN, Cotton $BAL and Coffee ( $JO is ETF -- when above $18.02 and especially when trading above above $19.00, then $27 is interim target ), and even wheat to some degree. Equities that would benefit from a rise in these commodity markets should have a tail-wind. Silver and Gold stocks, which RunningAlpha.com has been bullish on for a few months now, still shows signs of strength on pullbacks. Sourced from premium sentiment conviction list on RunningAlpha dot com
NYMEX:CL1!Long
by runningalpha