Baltic Dry indices: Week 43 technical commentary

October 30, 2017

 On the Great Lakes the autumnal gales, referred to as the 
"Witch of November", arrived a little early this year. In a late October storm, a weather buoy on Lake Superior recorded a wave height of 28.8 ft. / 8.8m; a bit nasty for the Lakes. In deference to all the witches, our lead photo is of the famous tea clipper Cutty Sark's figurehead. The namesake witch is holding the tail remnant snatched from Tam o'Shanter's horse in the famous Robert Burns poem.

Please don't read too much into it, dry bulk people - after all, we're at 3-year highs for the overall Baltic Dry Index....but all the same, beware the Witch of November.

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HANDYSIZE:

 

For Week 43, the Handysize Index gapped up once more, but moved in a relatively limited range of seven points around the three-year high. So far, our previous target of 750 - 775 for upside resistance is unchanged. Also, our support target in the 550 - 600 area stays the same. However, the slight levelling off in this index has us hoping for a new support zone closer to that upper resistance.

The RSI continues in a level pattern in the peakish mid-eighties, with a still-bullish MACD, hinting that Week 43's weakness could prove to be temporary.

Perhaps all that's needed for Christmas is a major vessel scrapping drive and no more new-builds for the immediate future?

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SUPRAMAX:

 

Week 43 saw the Supramax Index taking a rest, falling back to our previous 1100 target reached in Week 42; a little "dark-cloudish" in the candlestick chart, similar to the moves in Weeks 39 and 40.

With this retreat, our 975 - 1000 support target may come into play more. Hopefully we are seeing more consolidation steps here, as our RSI continues in the 70s with a slight weakening in the still-bullish MACD.

Also at three-year highs, the supras could be finding a comfortable perch for the time being.

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PANAMAX:

 

While repeating the three-year-high mantra, the Panamax Index however took a step backwards from Week 42's slightly bearish candlestick formation. 
There might be no cause for gloom; for the past several months the Panamaxes have performed their staircase climb within a band that is roughly 300 points wide.

Any falling below the 1400 area might signal some weakness and/or consolidation, and our upside resistance target is still around 1750 - 1775.

The MACD is showing some weakness as it takes a rest in its bullish trajectory. The RSI remains close to 60; somewhat
neutral. With the Panamaxes seemingly acting as the cautious bellwether for the other indices, it bears close watching.

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CAPESIZE:

 

It's interesting to compare this Capesize Index with the peak of late 2014, when the Capes hit 3552 and the other indices were at least 200 points lower than their current levels. This time, the other indices seem to have built a more solid base within the shadow of the Capes. Like the handies, for Week 43 this index saw a limited range on its way to the 3220 weekly close.

Still within something of a range, the index has once again reached for our 3250 resistance target. The RSI is still consistently in the peakish 70s, and the MACD shows some slight shakiness within its general bullish trend.

Should there be a failure to break through 3250, we can hope for some support in the recent consolidations around 2200 - 2700. However, we're still keeping an eye on the 2000 area, given this index' volatility.
 

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