Since I wrote my "Fading Fast Money" morning call on 5/21, Brazil's stock market is down -12.1%. Call us lucky or call us right, we're cool with both.

The chart of the Brazilian Bovespa Stock Index is as interesting as any Global Macro one that I am currently looking at. Within my macro model, its critical to differentiate between a "Trade" (short term) and "Trend" (intermediate term). From this perspective, Brazil is actually broken on a short term "Trade" basis, for the 1st time in Q2. Brazil's central bank continues to raise rates aggressively, and economic historians will recall that Brazil has indeed had economic cycles in the past!

The Bovespa got crunched on Friday, closing down -3% at 64,613, underperforming the US stock market, which has rarely happened in 2008. This was an important macro callout and negative divergence.

"Trend" line support for the Bovespa is 61,300. Clearly, for the "own everything agriculture community" this levee line needs to hold. On the upside, a recovery rally closing above 66,082 would definitely be incrementally bullish.

As always, I remain data dependent.
KM
(chart courtesy of stockcharts.com)