Ceasefire Expires Today — IRGC Reverses Hormuz “Open” — Trump: Extension “Highly Unlikely” — Brazil Closed Tomorrow
Today’s Brazil morning call opens on the day that defines the war’s next chapter — and the day before Brazilian markets go dark. This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.
The two-week ceasefire that began April 7 expires today — “Wednesday evening, Washington time,” per Trump. The IRGC reversed Friday’s Strait of Hormuz “open” declaration over the weekend, saying it “returned to its previous state.” On Monday, the U.S. seized an Iranian-flagged cargo vessel near the Strait, escalating tensions. Only three ships crossed the waterway Monday — a fraction of normal traffic. Trump told Bloomberg it’s “highly unlikely” he extends the ceasefire and that he won’t reopen the Strait “until a deal is signed.” Yet Iran is “positively” reviewing sending a delegation to Islamabad for a second round of talks, per AP. Iranian delegates reportedly plan to arrive in Islamabad on Tuesday to meet Vance. The gap between rhetoric (deal close) and reality (Strait closed, vessel seized, extension unlikely) is the widest of the entire war.
Monday saw the Nasdaq snap its 13-day winning streak — the longest since 1992. The S&P 500 fell 0.24% to 7,109, the Nasdaq dipped 0.26% to 24,404, and the Dow was flat at 49,443. Oil jumped ~6% on the Strait re-closure. The Russell 2000 hit a new closing ATH at 2,793 (+0.58%). The Ibovespa rose 0.20% to 196,132 on Monday, with the USD/BRL crashing to a stunning R$4.9535 (chart: RSI 33.97 / MA 26.96 — the most extreme oversold of the entire war).
Critical: Brazil is CLOSED tomorrow (Tiradentes Day). The Ibovespa will not trade on the ceasefire expiration day. Whatever happens with the Strait, nuclear talks, and potential deal/collapse will play out while B3 is shut. Brazilian investors must position today for a 48-hour gap into Wednesday’s reopen. Today’s calendar: US Retail Sales (08:30, cons: +1.4% MoM — rescheduled from April 16). Pending Home Sales (10:00). German ZEW (05:00, cons: −6.7). Atlanta Fed GDPNow (11:30). Fed Waller (14:30). API Crude (16:30). War Day 52.
Three Things That Matter
| Monday | S&P 500 −0.24% to 7,109. Nasdaq −0.26% to 24,404 (13-day streak snapped — longest since 1992). Dow flat at 49,443. Russell 2000 +0.58% to 2,793 (NEW CLOSING ATH). Oil jumped ~6% on Strait re-closure. U.S. Navy seized Iranian-flagged cargo vessel near Strait. Trump: “highly unlikely” to extend ceasefire, won’t open Strait “until a deal is signed.” Iran “positively” reviewing sending delegation to Islamabad. Only 3 ships crossed Strait Monday. Ibovespa +0.20% to 196,132. USD/BRL crashed to R$4.9535 — new war-era low for dollar. BTC $75,773. Gold ~$4,880 |
| Ceasefire Status | EXPIRES TODAY (“Wednesday evening, Washington time”). IRGC reversed Friday’s “open” declaration — Strait “returned to previous state.” U.S. blockade of Iranian ports continues. Vessel seized Monday. Nuclear deal terms still unresolved despite Trump claiming “indefinite suspension.” Iran delegates reportedly heading to Islamabad for second round with Vance. Pakistan hosting. Ceasefire technically alive until expiration tonight. Key question: does Trump extend unilaterally? Does a framework emerge from Islamabad? Or does the ceasefire lapse and strikes resume? |
| Today | BRAZIL CLOSED TOMORROW (Tiradentes Day). Last chance to position before 48-hour gap. German ZEW (05:00, cons: −6.7). US Retail Sales (08:30, cons: +1.4% MoM / core +1.3%). ADP Weekly Employment (08:15). Pending Home Sales (10:00). Atlanta Fed GDPNow Q1 (11:30, prev: 1.3%). Fed Waller (14:30). API Crude (16:30, cons: −1.0M). ECB De Guindos/Nagel (02:30-03:00). UK Employment data. Japan Trade Balance overnight. Ceasefire expiration tonight. War Day 52 |
Where We Left Off MONDAY, APR 20 — SESSION CLOSE
Monday’s session was defined by the gap between Friday’s euphoria and the weekend’s reality check. The Nasdaq’s 13-day winning streak — the longest since 1992 — finally snapped with a 0.26% decline to 24,404.39. The S&P 500 slipped 0.24% to 7,109.14, retreating from Friday’s 7,126 ATH. The Dow was essentially flat at 49,442.56. But the Russell 2000 told a different story, surging 0.58% to a new closing ATH of 2,792.96 — the first record for small caps since January, confirming the rally’s breadth is finally broadening beyond mega-cap tech.
The session’s tension came from the Strait. The U.S. Navy attacked and seized an Iranian-flagged cargo vessel it said had tried to evade the naval blockade — the first physical confrontation since the blockade began. Iran vowed to respond. Oil jumped ~6% as only three ships crossed the waterway Monday, confirming that Friday’s “completely open” declaration was either premature or reversed. Trump poured cold water on extension hopes, telling Bloomberg it was “highly unlikely” he’d extend the ceasefire and that the Strait stays closed “until a deal is signed.” Yet simultaneously, Iranian authorities told AP they were “positively” reviewing participation in a second round of talks in Islamabad this week, with delegates reportedly heading to Pakistan.
The Ibovespa managed a 0.20% gain to 196,132. Chart: O:195,734, H:196,724, L:195,282, C:196,132. RSI at 65.53 (MA: 65.17) — balanced, bullish but not overextended. MACD histogram at 3,885 (MACD: 3,330.71, signal: 554.33). The USD/BRL was the standout: chart shows O:4.9535, H:4.9535, L:4.9535, C:4.9535 (0.00%) — closing at the deepest war-era low for the dollar. RSI at 33.97 (MA: 26.96) — both readings are the most extreme oversold of the entire cycle, signaling that the BRL’s structural appreciation has now entered uncharted territory. As covered in yesterday’s Morning Call, the IRGC reversal on the Strait created the weekend cliffhanger. Monday confirmed it: the ceasefire’s expiration is a live event, not a formality.
Market Snapshot DATA AS OF MON, APR 20 CLOSE
| Indicator | Close / Level | Change |
|---|---|---|
| Ibovespa | 196,132 | +0.20% |
| USD/BRL | R$4.9535 | New war-era low |
| S&P 500 | 7,109 | −0.24% |
| Nasdaq | 24,404 | −0.26% (streak end) |
| Russell 2000 | 2,793 | +0.58% (NEW ATH) |
| WTI Crude | ~$87 | +~6% |
| Bitcoin | $75,773 | −0.13% |
What to Watch TUESDAY / EXPIRATION DAY
The ceasefire expires tonight. Everything else is secondary. Three scenarios define the binary outcome: (1) a framework deal or ceasefire extension emerges from Islamabad talks → oil drops, S&P extends, BRL strengthens further on Wednesday’s reopen; (2) the ceasefire lapses without an extension but talks continue → oil gaps higher, volatility spikes, but the market treats it as a negotiating tactic; (3) the ceasefire expires, strikes resume, and the Strait fully re-closes → oil surges toward $100+, the S&P gives back 3-5%, and the Ibovespa opens Wednesday with a gap-down toward 190,000.
March Retail Sales at 08:30 ET (cons: +1.4% MoM / core +1.3%) is the most important U.S. consumption data point of the month. This is the first reading that captures the oil shock’s full impact on consumer spending. A strong print validates the “consumer is resilient” thesis; a miss confirms the Beige Book’s amber warnings. German ZEW at 05:00 (cons: −6.7 sentiment, −70.0 current conditions) measures European investor confidence under the blockade.
Brazil is closed tomorrow (Tiradentes Day — national holiday). The Ibovespa and B3 will not trade. The ceasefire expiration, any potential deal or collapse, US Retail Sales reaction, and oil’s next move all play out while Brazilian markets are shut. This creates a 48-hour information gap — whatever happens tonight and tomorrow trades into the Ibovespa on Wednesday’s open. Brazilian investors must position today for maximum uncertainty.
Ibovespa Setup TECHNICAL LEVELS
Chart: O:195,734, H:196,724, L:195,282, C:196,132 (+0.20%). RSI at 65.53 (MA: 65.17) — balanced, bullish, not overextended. MACD histogram at 3,885 (MACD: 3,330.71, signal: 554.33). The index has consolidated from the 198,657 ATH to the 195,000-197,000 range — a healthy reset that positions it for the next directional move.
Resistance: 196,132 (Monday close) → 196,415 (upper range) → 198,657 (ATH) → 200,000 (psychological).
Support: 195,540 (mid) → 193,808 (upper SMA cluster) → 190,503 / 190,215 (mid-Bollinger) → 189,219 / 187,197 (SMA clusters) → 186,825 / 186,537 (lower range) → 178,026 (lower Bollinger) → 159,020 (200-day).
Copom Watch SELIC AT 14.75% · NEXT MEETING: APR 28-29
The Copom meets in exactly one week. The ceasefire’s resolution today directly shapes the April 28 decision. If extended or replaced by a deal: hold at 14.75% with dovish forward guidance opening June cut. If collapsed: hold at 14.75% with hawkish vigilance language and no cut signal. The USD/BRL at R$4.9535 — its deepest war-era low — gives the BCB maximum flexibility. Even if oil rebounds on a lapsed ceasefire, the BRL’s structural strength provides a significant inflation offset. Monday’s Focus Readout showed the first material dovish shifts in economist expectations, consistent with BRL sub-R$5.00 for a full week.
Economic Calendar TUESDAY, APR 21
| Time | Event | Impact |
|---|---|---|
| Pre-Market | UK Employment: Claimant Count (02:00, cons: +21.4K), Unemployment (cons: 5.2%), Avg Earnings (cons: +3.6%). German Buba Nagel (02:30). ECB De Guindos (03:00). Spanish Trade Balance (04:00). German ZEW Economic Sentiment (05:00, cons: −6.7) / Current Conditions (cons: −70.0). German Schatz Auction (05:30). BRAZIL CLOSED (Tiradentes Day) — B3 shut all day | HIGH |
| 08:15–08:30 ET | ADP Weekly Employment (08:15, prev: 39.3K). US Retail Sales (08:30, cons: +1.4% MoM / core +1.3% / Retail Control +0.2%). First consumer spending print capturing the full oil shock. Strong = consumer resilient. Miss = Beige Book warnings confirmed | CRITICAL |
| 10:00–14:30 | Pending Home Sales (10:00, cons: 0.0%). Business Inventories (10:00, cons: +0.3%). Atlanta Fed GDPNow Q1 (11:30, prev: 1.3%). Fed Waller speaks (14:30) — first post-ceasefire-expiration Fed commentary | MEDIUM |
| Evening / Night | CEASEFIRE EXPIRES (“Wednesday evening, Washington time”). API Crude (16:30, cons: −1.0M). Japan Trade Balance overnight (cons: +¥1,106B). Colombia Trade Balance (11:00). Any deal/extension/collapse announcement could come at any hour. Maximum binary event risk for overnight positioning | CRITICAL |
Latin America Markets MONDAY CLOSE / CHART DATA
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa | 196,132 | +0.20% | 65.53 | Bullish |
| IPC (Mexico) | 70,084 | +0.37% | 55.68 | Neutral |
| COLCAP (Colombia) | 2,287 | −0.65% | 50.45 | Neutral |
| IPSA (Chile) | 11,344 | −0.75% | 64.60 | Bullish |
| MERVAL (Argentina) | 2,931,701 | +1.47% | 54.91 | Neutral |
Argentina’s MERVAL bounced 1.47% to 2,931,701 — the strongest single-day LatAm performance on Monday — as the peso-insulated market traded on domestic dynamics rather than oil. Mexico’s IPC rose 0.37% to 70,084 with RSI at 55.68. Colombia’s COLCAP fell 0.65% to 2,287 as oil’s 6% jump paradoxically weighed on the index (uncertainty > price benefit). Chile’s IPSA slipped 0.75% to 11,344, consolidating after its surge to near-overbought levels. The Ibovespa’s RSI at 65.53 is the best-positioned in the region for a directional move — balanced between overbought and neutral, with the Wednesday reopen providing the catalyst. As covered in the latest LATAM Pulse, the Tiradentes holiday creates a unique positioning challenge: Brazilian investors must hedge or accept the ceasefire’s binary outcome blind.
Commodities & FX KEY MOVES
Oil rebounded ~6% Monday after the IRGC reversal and the vessel seizure confirmed the Strait remains contested. WTI climbed to ~$87 from Friday’s $82.59 crash low. The ceasefire expiration tonight is the next binary catalyst. If a deal framework emerges, WTI targets $78-82. If the ceasefire lapses and strikes resume, $95-100 returns quickly. The API inventory data tonight (cons: −1.0M) will show the first post-Hormuz-reversal storage picture.
USD/BRL at R$4.9535 (chart: O:4.9535, H:4.9535, L:4.9535, C:4.9535) — the deepest war-era low for the dollar. RSI at 33.97 (MA: 26.96) — both readings are the most extreme oversold of the entire conflict. The MACD is deeply bearish at −0.0140 (signal: −0.0544, MACD: −0.0684). The real has appreciated ~9% from its March war-era peak. This extreme oversold reading historically precedes a short-term bounce — but in the context of a potential peace deal, “oversold” becomes “structurally repriced.” If the ceasefire extends, R$4.90 is the target. If it collapses, R$5.05-5.10 is the snap-back zone.
Bitcoin held at $75,773 (chart: O:75,870, H:76,283, L:75,518, C:75,773, −0.13%). RSI at 60.39 (MA: 60.07) — equilibrium. BTC has been remarkably stable above $74K, suggesting the crypto market has already priced through the ceasefire’s outcome.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| Iran is heading to Islamabad — talks are happening despite the rhetoric — The AP reported Iranian delegates plan to arrive Tuesday. Pakistan is hosting. Vance has a “final and best offer” on the table. The nuclear suspension was agreed in principle. The Israel-Lebanon ceasefire removes the key side-conflict. Trump’s “highly unlikely to extend” may be negotiating leverage, not final position. The “TACO” trade (Trump Always Chickens Out) has worked every time.
The Russell 2000 at a new ATH shows the rally broadening — this isn’t a narrow-tech phenomenon anymore — Small caps at ATH + Dow Transports at 16th ATH + S&P above 7,100 = genuine broad-market conviction. Earnings at 12.6% growth. The breadth confirmation the bears demanded has arrived. USD/BRL at R$4.9535 is the most powerful structural signal of the war — Six consecutive closes below R$5.00. The carry trade is winning. The 14.75% Selic with BRL appreciation is the EM proposition of the decade. Even if the ceasefire lapses, the structural shift is real — capital flows don’t reverse overnight. |
Trump said it himself: “highly unlikely” to extend, Strait stays closed “until deal is signed” — This is not ambiguous. The ceasefire expires tonight. The Strait is not open — only 3 ships crossed Monday. A vessel was seized. Iran threatened retaliation. If Trump means what he says, strikes could resume within hours of expiration. Oil back to $95+ immediately.
The IRGC reversal on “Hormuz open” shows Iran’s military doesn’t follow its diplomats — Friday’s FM declaration was overruled by the IRGC within 24 hours. This means any diplomatic agreement can be undone by Iran’s military command. Even if Islamabad talks produce a framework, IRGC compliance is not guaranteed. The physical reality of the Strait — 3 ships, blockade active, vessel seized — is the only signal that matters. Brazil is closed tomorrow — maximum gap risk for Brazilian investors — The Ibovespa at 196,132 enters a 48-hour blackout during the most binary geopolitical event of the war. If strikes resume and oil surges, the index opens Wednesday with a 2-4% gap-down toward 188,000-190,000. The USD/BRL at R$4.95 with RSI/MA at 34/27 is the most extreme oversold of the war — a ceasefire collapse triggers a sharp snap-back toward R$5.10. Position size matters more than direction today. |
Positioning BOTTOM LINE
Day 52 of the war. The ceasefire expires tonight. The Strait is contested. Iran is heading to Islamabad. Trump says extension is “highly unlikely.” A vessel has been seized. Oil is back at $87. The S&P 500 is 0.2% off its all-time high. The Nasdaq just snapped its longest winning streak since 1992. The Russell 2000 is at an ATH for the first time since January. The Ibovespa sits at 196,132 with the most balanced RSI setup (65.53) since the ceasefire began. The BRL at R$4.9535 is at the most extreme oversold reading of the entire war — a currency that has structurally repriced from R$5.43 to R$4.95 in six weeks.
And tomorrow, Brazil is closed.
This is the positioning challenge of the cycle. The ceasefire expires while B3 is shut for Tiradentes Day. Whatever happens tonight — deal, extension, collapse, strikes — trades into the Ibovespa on Wednesday morning, not tomorrow. Brazilian investors must decide today: hold through the gap, hedge with dollar-denominated instruments, or reduce exposure. The carry trade’s extraordinary returns (14.75% Selic + 9% BRL appreciation = ~24% annualized in dollar terms) argue for holding through the noise. The ceasefire’s binary outcome argues for prudence.
The narrative arc of this war — from panic to ceasefire to blockade to blockade-shrugged-off to S&P ATH to Hormuz-open to Hormuz-reversed — resolves this week. Eight weeks of the most dramatic market story since COVID converge on a single evening. The BCB meets in 7 days. The 200,000 Ibovespa milestone sits 3,868 points away. The R$5.00 barrier — breached for six days — could become permanent support or temporary overshoot. Watch the Strait. Watch the ships. And remember: the market has been right about this war at every turn — pricing peace before it arrived, pricing through the blockade, pricing the deal before it was signed. If the market is right again, the ceasefire becomes a deal, the Strait reopens, and the post-war era begins this week. If it’s wrong, Week 8 of the war begins with a vengeance.
RT Staff Reporters · This newsletter is for informational purposes only and does not constitute investment advice. Always consult a licensed financial advisor before making investment decisions. Past performance does not guarantee future results.