Baltic Dry indices: Week 42 technical commentary

Well, how should ship-owners receive this latest surge upwards in the Baltic indices? Should their spirits zoom? (From deep depression up to gloom?) If the days of “easy” ship financing are over for now, can newbuilding ideas be contained and keep rates up? Let’s explore further.

HANDYSIZE

For Week 42, the Baltic Handysize Index continued its leapfrog move off previous peaks, and came within 100 points of late 2013 highs. Should we go from extremely cautious
to just plain cautious optimism? The gap upwards in the candlestick chart suggests continued bullishness, and we have a new upside resistance target in the 750 – 775 range.

For the past month or so, the RSI has been content to level

off around the mid-80s, in peakish territory but not too volatile.

The MACD continues in bullish form, but should we see weakness below our 750 – 775 target there might be a consolidation zone between that zone and the upper 500s / lower 600s area.

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SUPRAMAX

The Supramax Index gapped up through our 1100 target area a little, after some consolidating steps over the past month.

More upward action beyond 1175 – 1200 could mean some support building at the recent resting area around 975 – 1000.
Like the handies, the Supra index hasn’t seen these heights since late 2013.

With some bullishness still in the MACD, and the RSI showing some slight steadiness, there could still be some upward momentum in this move. We’re proceeding with caution of course.

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PANAMAX

If we look at the Panamax candlestick chart for Week 42 below, we can see a curious little formation.
Although showing a gap up from Week 41, this inverted ‘T’ might suggest some loss of momentum in this
Panamax run-up. Hallowe’en might be coming, but this isn’t quite the ominous-sounding “gravestone doji” of the candlestick trader. However, we should pay attention to similar Panamax index movements, such as in late 2016.

The RSI showed some consistency, sailing along neutrally in the 60s for the past few weeks, as the MACD continued in a bullish tone.

We can hope that this is a sign of another consolidating rest for the Panamaxes. Our upside resistance target is in the 1750 – 1775 area. Some support in the 1350 – 1400 zone would be nice, should Week 42 prove to be a temporary weakness.

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CAPESIZE

Some consolidation seems to be entrenching itself in the Capesize Index. Although we saw a gap up for Week 42, the overall picture of the past month has been one of advances and retreats.

Our previous upside resistance target remains unchanged around 3250, and recent activity makes us wonder if the Cape Index has found a sideways range between 2500 and 3200 to cruise along in.

As with the other indices, the Cape Index RSI has stayed consistent (though peakish) over the past few weeks. There was a more bullish aspect to the MACD in Week 42, however.