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Highlights:\nThe index is currently in a corrective phase, following the seasonal pattern we often see in January.<\/p>\n
Highlights:
\nThe index is currently in a corrective phase, following the seasonal pattern we often see in January.<\/p>\n
The main focus of this technical should be on the Cal 19 futures, as this has the longest data history, and allows us to look at the longer term technical trend.<\/p>\n
Pretcher and Frost in their book the Elliott Wave Principal, agreed with Elliot that wave 3 could never be the shortest wave (page 27). On this basis this would suggest that the middle leg (Marked 1 with no brackets), should in theory be the 1st leg of wave 3, as this is the shortest wave in the sequence. Implying that after this current corrective phase we should continue in an upward trend.<\/p>\n
Pretcher and Frost also noted, that unlike equities, commodities markets often had an extended 5th rather than 3rd wave.<\/p>\n
Capesize Index<\/strong> The Capesize index is currently in a corrective phase with price below its short and long term moving averages.<\/p>\n The stochastic is showing a bullish divergence. However, this does not mean the market is going to go up, but a warning that downside momentum could be slowing.<\/p>\n Technically price action looks oversold, but remains bearish due to lower highs and lower lows.<\/p>\n Upside moves that close above the USD 20,890 resistance would suggest the technical argument is firming, as would price action above the shorter period EMA’s. Ultimately these need to be supported by higher highs and higher lows, as price action is the lead indicator. Upside moves that fail to close above USD 20,890 would keep the trend in bear territory.<\/p>\n The bullish divergence is not a buy signal. With price below short period EMA’s and not producing higher highs this trend remains technically weak at this point.<\/p>\n <\/p>\n Capesize Feb 18 Daily<\/strong> Like the index the Feb futures are in a corrective phase, and below the shorter period MA.<\/p>\n Momentum remains bearish with the stochastic at 32 and could soon enter into oversold territory. Technical support is at USD 11,200, as this is the 100\\% projection of A – B from point C. At this level the current wave will be regarded as technically overextended to the downside.<\/p>\n Upside moves that fail to close above the minor technical resistance at USD 13,990 would have technically bearish implications going forward, as this will create a lower high.<\/p>\n A close above the USD 13,990 resistance would create a market high, and have potential bullish implications going forward. However, point C was a single upward move, making this a weak technical signal. If the fast EMA (orange) is above the medium EMA (pink) and point C has been broken this would strengthen the bullish argument.<\/p>\n <\/p>\n Capesize Q2 18 Daily<\/strong> Like the rest of the Cape complex, the Q2 18 futures have entered into a corrective phase. Unlike the Index and the Feb 18 futures, the Q2 remains above key moving averages, and in bullish territory.<\/p>\n A support zone has formed between the April 2017 high and the peak on the 11th Dec 2017 (USD 15,100 and USD 14,850).<\/p>\n Downside moves that hold above this zone would keep the Q2 18 futures in bull territory.<\/p>\n From an Elliott wave perspective if we hold at the support zone this would also suggest that the corrective phase is part of a larger cycle, and imply higher prices going forward.<\/p>\n If the support zone is broken it would imply that market buyers are not willing to protect a key support zone, and from a technical point of view it would suggest continued weakness in the market.<\/p>\n In a corrective phase, but remains in bull territory at this point.<\/p>\n <\/p>\n Capesize Cal 19 Weekly<\/strong> For the Cal 19 futures we are going to look at the longer term trend (weekly chart), as this has the most data, and gives a view on the longer term footprint of the market.<\/p>\n For this we are going to look at the Elliott Wave, particularly the later stages of the cycle.<\/p>\n Longer term the cycle appears to be on wave 5. We also seem to have 5 waves in final wave, however the middle wave is the shortest wave. Both Elliot, as well as Pretcher and Frost believed that the 3rd wave could not be the shortest wave in any cycle. If this is the case, and they are correct, then the then this would suggest that the current wave is in fact a wave 3, inside of a wave 3, and have longer term bullish implications for the market going forward. This would also suggest that when we look at the individual quarters in the Capsize complex where we have less data to evaluate, that providing they follow the same technical footprint they should replicate the Cal 19<\/p>\n Technically we are in a corrective phrase, if the Elliott cycle is correct, then this trend should continue to remain bullish.<\/p>\n Source: Freight Investor Services (FIS)<\/p>\n","protected":false},"excerpt":{"rendered":" Highlights: The index is currently in a corrective phase, following the seasonal pattern we often […]<\/p>\n","protected":false},"author":1,"featured_media":128410,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[273],"tags":[],"class_list":["post-128412","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-maritimes-news"],"yoast_head":"\n
Support – 12,899, 11,087, 5,224
Resistance – 20,890, 22,613<\/p>\n
Support – 11,200, 10,270, 9,990
Resistance – 13,990, 16,130<\/p>\n
Support – 15,100, 14,850, 14,045
Resistance – 16,415, 16,850<\/p>\n
Support – 14,800, 14,180
Resistance – 16,121, 16,453<\/p>\n