by Dave Walker
The Handysize Index continued its rise in Week 25, increasing its range and posting an 18-point surge to fix at 440.
Taking a bounce up off our 700 – 715 support ideas, the Supramax Index fixed at 751 for Week 25. After our downside bias thoughts in Week 20 were somewhat confirmed, the low-700s support seems to have continued the sideways channeling of the Supras.
Once again we’re watching our 775 – 875 upside resistance, a level that we’ve been eyeing since Week 7. It remains to be seen if there is still strength in this persistent zone of resistance, which the Supras have turned away from twice this year so far.
For Week 25 the Panamax Index decline slowed its momentum, tightening its range and fixing at 1096, as it retreated from our 1350 – 1400 resistance.
Our Week 17 thoughts of support in the 975 – 1000 range are now coming into play as the Panamaxes’ decline from our 1350 – 1400 resistance zone slows. On the threshold of that range now, let’s see if enough support builds to keep the index afloat.
For Week 25, after a brief pause at Week 20’s 1800 – 2000 resistance target, the Capesize Index surged slightly through that zone and fixed at 2278.
Our RSI , easing off in its climb, reached a peakish 83.52. The MACD rose well into positive values, curving slightly away from the signal line with the index boost. A small observation – of course these indicators are something the Capes pay scant attention to (like many others?). However, the last time our RSI showed these values was at the first index peak after recovery from the lows of 2016.
From back in Week 20, we’re still watching our 1000 – 1200 support ideas in case of any weakness in the index. As we mentioned last week, our 1800 – 2000 target could act as a stepping stone for more index progress, but it remains to be seen if there is any attraction left for this target.
A rising tide lifts all boats as they say – ‘they” in this case being Brazilian iron ore miners, to whom the Capesize bungee cord is well attached. Of course, when the iron ore industry sneezes, the Capes come down with a cold – stay tuned. (See? We do mention fundamentals now and then…)