Resistance – 8,950, 9,794, 10,034

Support –6,934, 6,680, 5,769

Support has been broken on the Supramax index, and we are now trading below the 200 and 50 period MA’s on the weekly chart.

We maintain are near term bearish view on the index due to the lower high that formed on the 21-4-17, on the back of a bearish divergence with the stochastic.

The stochastic has now entered into oversold territory, however we remain USD 750 away from the next support level. Upward moves that fail between the USD 8,500 – USD 8,950 resistance zone would indicate downside continuation. A weekly close below the USD 6,934 support would be below the major pivot low from the 10-2-17 and confirm a long term change in the trend bias to bearish.

Bullish candles above the USD 8,934 support level would attract short term technical buyers. This would leave the index with a lower high and higher low, and suggest we have entered a period of consolidation within the Index.

Supramax Q3 17 Daily
Resistance– 7,855, 8,310, 8,455, 9,215,

Support –, 6,965, 6,396, 6,165

We mentioned last week that price action is the lead indicator over the stochastic in this technical, and this has proved to be the case, resulting in a USD 1,000 downward move so far.

The trend remains bearish due to the lower high and lower low, and price action remains the lead indicator over the stochastic at this point.

Technical support can now be found at USD 6,965. If support holds we could see a counter trend upward move targeting the USD 7,855 level. However this would be regarded as a higher risk trade as it is against the trend.

Technical sellers looking to go with the trend should be looking for upside failure at the USD 7,855 resistance level.

Supramax Cal 18 Daily
Resistance – 8,495, 8,625, 8,940

Support –, 7,974, 7,800, 7,570

The Cal 18 futures remain in a bearish trend, and support levels have been broken. Price action remains bearish due to the lower highs and lower lows.

The stochastic remains oversold due to the bearish nature of the trend. We maintain our view that market buyers need to see a higher low before entering the market, unless looking for short term upward swings in the market.

USD 7,974 is the 200 period MA support, price rejection from this level could see a near term move up to the USD 8,500 level. However this is a counter trend trade and carries higher risk.

Technical sellers need to see an upward swing towards the resistance level before looking to enter from the sell side, to avoid selling into potential support.

Technically bearish, sellers need to see a mean reversion before entering from the sell side. A higher low should have market shorts looking to tighten risk.

Supramax Q3 V Cal 18 Daily
Resistance– (-670), (-465), (-237),

Support – (-800), ( – 870), (- 1,1000

The bullish divergence spectacularly failed last week and the downside move continued.

The first technical resistance can be found at USD -670, however the more important resistance is around the USD – 465 level. Upside moves that fail at this resistance should attract fresh technical sellers to the market.

Market buyers should look for a higher low before entering the market due to the bearish nature of the trend.

The stochastic is oversold, but the trend is technically bearish. This would suggest the more reliable signals should come from the sell side on the stochastic. However it is worth keeping an eye out for market divergences as they can give early signals of price change especially if followed by strong upward price thrusts.

Source: FIS