Panamaxes bounce off our support; Capes surge on. Baltic Dry Indices: Week 26 commentary.

by Dave Walker

HANDYSIZE

Week 26 showed a flat Handysize Index, fixing at 442 on a non-existent range. Giving some credence to our Week 20 upside resistance ideas in the lower 400s, the index however paused closer to our Week 21 450 – 475 target zone after its solid gains.

Our RSI trickled down closer to neutral at 45.70, while the MACD took little notice of the pause to continue on in bullish fashion.

With the index midway between possible lower 400s support and our 450 – 475 target, it remains to be seen how the Handysize push-and-pull will work out. Improving fundamental sentiment in the dry bulk sector may be its saving grace.


SUPRAMAX

Another positive move marked Week 26 for the Supramax Index. With a fix at 787 on a decent 31-point move up, the Supras have re-entered our recurring 775 -875 resistance band which has proved a challenge to the index for most of 2019.

Our RSI kept just above the neutral zone at 44.80 as the MACD took a positive turn away from its signal-line, avoiding recent weakness.

It now remains to be seen what strength the index may have to push further into this 775 – 875 resistance. With some of our indicator spreads approaching peakishness, we’re watching the Supras with interest.


PANAMAX

A positive snap-back was seen in Week 26 for the Panamax Index. With a fix at 1286 after a 175-point run, the index took a solid bounce up just above our 975 – 1000 support ideas discussed back in Week 17.

Our RSI stayed in peakish territory with the up-move, while the MACD followed the index and backed away from its path towards the signal-line.

Do the Panamaxes now have enough momentum for another push at our Week 19 1350 – 1400 resistance zone? Possible, with the sudden overall optimism in dry bulk sentiment. Being a cautious bunch however, peakish signs remain for us.


CAPESIZE

Week 26 was another positive one for the Capesize Index. Pushing further away from our Week 20 1800 – 2000 resistance target, which in the Capes’ case was a mere stepping-stone on the chart, the index gapped up off the open and fixed at 2488.

Our RSI continued into peakish values, reaching 93.64. The MACD reached well into positive values with the index exuberance, happily tagging along in its bullishness.

While our indicators point towards rising peakishness, this of course is something the Capes have thumbed their noses at on a semi-regular basis. A tentative 2800 – 3000 target is in our sights for now, but having studiously avoided any Baltics’ news at time of publishing, the index may be there already. Such are the Capes – always poking fun at the pundits and often several steps ahead.


$BDRY Breakwave Dry Bulk ETF – Week 26, 2019.

$BDRY Forward Freight Agreement weighting: Capesize: 50%, Panamax: 40%, Supramax: 10%.

BDRY profile: ”The Fund’s investment objective is to provide investors with exposure to the daily change in the price of dry bulk freight futures, before expenses and liabilities of the Fund, by tracking the performance of a portfolio consisting of a three-month strip of the nearest calendar quarter of futures contracts on specified indexes that measure rates for shipping dry bulk freight.” Source: drybulketf.com


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