On Monday, there will be a gap of loss

I will have to be fast and efficient tonight.

Brazil decided for re-electing the current President with 51% of votes. As I described on previous posts this is not what investors prefer (IBOV fell more than 10% in the last 2 weeks). In my personal opinion, IBOV will open on monday with a gap of loss around -5%.

It is possible to earn a lot of money when the markets go down. I already wrote 2 posts about this topic and there are many methodologies to operate this way.

Traders are ready for everything! As you know, on this blog we let profit continue as much as possible and we cut losses really fast. We will continue this way and I hope to help as many people as possible, because many of them will see part of their investments go down even more of what they saw in October.

Have a great week! And please, share this post with your friends that invest in stocks because for sure we can recover from this loss.

Leo.

1 more week to definition. Until there: be cautious

IBOV had another volatile week as it was expected as you can see on the first chart. I have been discussing this with you for a couple of weeks and I believe this will happen again next week, because the elections for president will be next Sunday. The Markets show it prefer Neves than Roussef (current president) as I described in one of my previous posts.

Last week I posted 2 forecasts and both started. NATU3 achieved profit in just 2 days as you can see on the second chart, but RENT3 started, gained +1.7% but it didn’t achieve our target and went down as all other stocks in Brazil.

After 103 trades, we maintained 74% of profitable forecasts and 26% had loss.

Next week I’m not going to operate, because I prefer to wait and do more conservative trades.

Have a great week.

Leo

Opportunities in stocks in Brazil

After the offcial results of the first round of the elections in Brazil IBOV had an amazing Monday, some indefinition from Tuesday to Thursday, and fell on Friday. Therefore, volatility and a lot of indefinition about the future.

In my opinion it will be like this until the second round (in 2 weeks). Marina Silva (3rd place) declared that she will support Neves (2nd place) in the second round and this increases the chances that Neves may win the elections (that is what most investors want) as I described in my previous post.

Because of the great day on monday, we couldn't buy KROT3 because the stock opened with a big GAP, and the opening price was much higher (more than 3%) than our Start Gain price, therefore, we couldn't start the trade.

For this week, 2 stocks call my attention, and let's see if these trades start this week.

NATU3 - Start Gain (buy ONLY IF achieves) 40.31 ; Stop Gain (sell 70% of what you buy) +2% ; Stop Loss 37.61
RENT3 - Start Gain (buy ONLY IF achieves) 38.82 ; Stop Gain (sell 100% of what you buy) +2% ; Stop Loss 36.56

Have a great week.

Leo.

Interesting... How Ibovespa is being affected by Presidential elections

As I wrote in my previous post, I was expecting a lot of volatility, but this was more than what I was thinking! IBOV went down on monday just 1 week before the 1st round of the elections, but recovered a little bit on Thursday and Friday as you can see on the first chart.

Where is IBOV going? Honestly, anything can happen during the next month, until the 2nd round. One thing that is clear for investors (and I mean American investors because they represent more than 50% of volume negotiated in Ibovespa) is that they prefer Aecio Neves than Dilma Roussef. This is based on the correlation that every time that Brazil showed a pool saying that Roussef would be re-elected, IBOV went down and every time it showed she could lose, IBOV went up.

Just to complement my ideas, here is a phrase from Bloomberg to support my position and the entire article: For much of the year stocks rallied on falling support for Rousseff in opinion surveys as investors bet an opposition candidate would do more to improve Brazil’s business environment, slash above-target inflation, and reduce deficit spending. Since Sept. 2, when the president started rebounding in the polls, the Ibovespa index has lost 11.9 percent and the real dropped 8.7 percent against the dollar.

http://www.bloomberg.com/news/2014-10-05/neves-to-face-rousseff-in-brazil-in-surprise-comeback.html

Therefore, I believe we will have a month of volatility and I believe IBOV may go up next week, because Neves reduced the distance to Roussef at the end of last week and this was confirmed today after the elections.

This week I will continue being conservative and I will only invest in KROT3 (if the trade starts)

Start Gain (buy ONLY IF achieves) 15.42 ; Stop Gain (sell 70% of what you buy) +3% ; Stop Loss 14.19

Have a great week and please, share this post with your friends that like to invest in stocks.

Leo.