BRLJPY Long BRL and JPY seen as debt ceiling event risk hedgeThe international capital movements continue to be driven by carry trade opportunities.
For hedging the debt ceiling event risk, traders like BRL, CNH, and JPY, where the first two provide the right beta to equities. While BRL provides a carry cushion, it is a bit more overvalued in some of our short-term models than CNH. The upside for CNH is likely viewed as reserve diversification hedge to the USD, especially if policymakers take the negotiations down to the wire.”
The Brazilian Real declined substantially after the minutes of the last meeting of the Brazilian central bank (Banco Central do Brasil, BCB) on Tuesday took a surprisingly more dovish tone than the original statement after the meeting had suggested.
A break below 15.425 is the beginning of the bearish trend, and confirmation that the current bullish trend
a bulltrap was...
Real has moved stabil above 22.60 ,made 2HH and 2HL( 23.718 and 24.801)
A break above 31.402, and 2 consequent closing days above this area delivers the final confirmation,
that the Bullish trend has been maintained.
First Traget is 63,546, as the Bears took control over the bulls on August 2009
The strategy is trend following
bullish
we can position size the pullbacks
The stop shall be put as soon as possible on break even ,if we pass 36,7 successfully.
(See green route!)
