Baltic Dry Indices: Week 14 technical commentary.

April 9, 2018

Well, casting an eye across last week's Baltic Indices does raise an eyebrow here and there, doesn't it? We'll have to see how much weight certain ...ahem... politico-economic statements can hold and for how long. As the markets return to full-week action after the Easter breaks, let's attempt to see through all this fundamental chaff (like all that nasty soybean export chatter) and calm our busy minds....maybe.

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HANDYSIZE

 

For Week 14 the Handysize Index stayed in the mid-600s, pulling back a little below our 675 - 700 upside resistance ideas. Back in Week 12 we spoke of our older 625 - 630 resistance zone becoming support if it was penetrated in this strong upswing. 

Week 14's rest in the handies may be hinting at such things, but it's early days yet. The RSI flattened off with the index
rest at 53.52, almost equal with Week 13's 53.10 as the MACD sympathetically weakened a little in its bullish run.

With these two indicators behaving somewhat neutrally as the MACD begins to lag, let's keep an eye on that 625 - 630 area should the handies weaken. For now though, we'll rest on our laurels for making those Handysize Index turn-around noises back in Week 7.

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SUPRAMAX

 

Week 14's Supramax Index showed a large gap down and took a run at our 975 - 1000 support zone. All we mentioned was something about "dizzy heights" and there it went. Of course there may have been other factors....cough, cough..., but as our above header says, let's try to see through the chaff.

Following the index, the RSI retreated to 61.17, and the MACD paused in its bullishness to flatten out and hold virtually the same value as Week 13. It remains to be seen how all the volatility from the trade-war and soybean talk pans out (Did we actually mention those nasty fundamentals there?). 

Our previously-mentioned 1100 -1200 resistance area seems to have batted the Supras firmly back to previous support, and we'll have to see how strong that 975 - 1000 support is in the next while.

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PANAMAX

 

The Panamax Index continued its downward path in Week 14, gapping down and closing at 1317, just below our old "attraction" zone of 1350 - 1400.

The MACD jumped across the signal line to the bearish side, possibly hinting at some future gloom, while the RSI stayed in neutral territory at 46.58.

Overall the Panamaxes have so far stayed within the range we've seen since early October 2017, and the inherent strength that this index displays may be a saving grace. Previous range lows in the 1250 region may be the ones to watch if this tumble continues.

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CAPESIZE

 

In Week 14, the Capesize Index gapped down to what some steam engine-room types might call a "low-low" alarm. Closing at 824, the index took a run at our possible "low-low" support in the 500s and confirmed our thoughts of a further tumbleWhether the floor is truly falling out remains to be seen, given the political rhetoric out there.

The RSI actually improved a little to just over 20, up from sub-20 levels over the past few weeks. The MACD, now lagging, is almost out of the picture although its severely negative value coupled with the slightly-higher RSI may indicate some upward pressure.

Previous Cape index lows over the last year or so have been in the 550 - 750 range, and we are knocking on that door now. Let's watch carefully lest this bungee cord lose its elasticity.

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