Capesize
August Futures – Technically bullish last week but buy-side momentum had stalled due to the lack of trend in the market, the futures traded below the base of the 3-river morning star pattern but held above the USD 25,437 support. Price has since traded above the USD 29,500 and USD 30,250 fractal resistance levels, to a high of USD 30,500. The futures have opened the week lower (18/07) with price trading below Friday’s low of USD 29,125 signalling the futures have entered a corrective phase on the intraday. Downside moves that hold at or above USD 27,200 will support a near-term bull argument, below this level will warn that the USD 25,500 fractal support could be tested, if broken the daily technical is considered bearish. Upside moves above the USD 30,500 high will target the USD 32,750 and USD 33,565 resistance levels. The technical is bullish based on the futures making higher highs and higher lows but the daily RSI is at 50 with the stochastic in overbought territory. Momentum is a warning that the futures are vulnerable to a test to the downside; however, if the RSI moves above and holds above the 50 level then the stochastic becomes less relevant.
Panamax
August Futures – Technically bearish last week with a near-term downside target at USD 17,188, there were warning signs that we had the potential to see a momentum slowdown. The futures traded to a low of USD 16,625 before trading up to a high of USD 19,500. We now looked to have completed the bearish wave 3 of the Elliott wave cycle, suggesting we have entered a countertrend wave 4. Upside moves that fail at or below USD 25,700 will leave the technical vulnerable to further tests to the downside, above this level the technical will have a neutral bias. Technically bearish with the upside move considered as a countertrend, this move does have the potential to be greater in time and price than recent upside moves, as it looks to be a higher timeframe wave 4. Downside moves below USD 16,625 will indicate the futures have entered a bearish wave 5, implying the USD 14,247 and USD 12,627 support levels could be tested.
Supramax
August Futures – Technically bearish last week we were seeing the futures find support on the back of a slowing index. Price traded to a low of USD 19,500 before moving higher. Intraday Elliott wave analysis remains bearish, implying upside moves should be countertrend at this point, above USD 23,545 the futures will have a neutral bias, only above USD 25,500 will it signal wave completion. If we fail to trade above the USD 23,545 resistance it will leave the USD 19,500 fractal low vulnerable, below this level, we have further support at USD 18,375 and USD 17,195.
Oil
September Futures – As noted last week, intraday Elliott wave analysis warned that the USD 98.50 support remained vulnerable. The futures traded USD 14.00 lower over the next three sessions. The futures have produced 5-waves lower on what looks to have been an extended wave-3 of a higher timeframe cycle. This would imply that the current upside move should be considered as a countertrend, warning there is a potential bearish wave 5 to follow. Upside moves that fail at or below USD 111.60 will leave the technical vulnerable to further tests to the downside, above this level the technical will have a neutral bias. Only above USD 120.41 will the wave cycle have failed. Downside moves (based on the current day’s high of USD 105.34 18/07) that trade below USD 94.50 have further support at USD 93.63 and USD 90.00, with a potential downside target as low as USD 86.37 using William’s approach.
Iron Ore
August Futures – We noted last week that the onshore cycle had yet to complete, suggesting that the USD 106.45 support looked like it would be broken in the following session, indicating some form of wave extension on the offshore product. Support was broken resulting in the futures trading to a low of USD 95.50. The futures are moving higher on the back of a positive divergence with the RSI, upside moves that fail at or below USD 108.86 will leave the price vulnerable to further tests to the downside, above this level the technical will have a neutral bias. Only above USD 115.75 is the daily technical bullish. The trend is bearish but in divergence; however, we are below a key resistance level meaning we remain vulnerable to further tests to the downside at this point.
Steel
August Futures – Technically bearish but not considered a technical sell for the last couple of weeks due to an intraday divergence, the futures remain in a consolidation phase with little price movement. Upside moves that close above the USD 830 level will warn that buying support is starting to increase, warning we could test the USD 890 resistance in the near term. However, upside moves that fail at or below USD 981 will leave the futures vulnerable to further tests to the downside, above this level the technical will have a neutral bias. Only above USD 1,064 is the daily technical bullish. Technically bearish but not considered a technical sell, we are seeing warning signs (based on price) that we could be about to see the USD 890 resistance be tested.
Tankers TD3
August Futures – Technically bullish with downside moves considered as countertrend last week. The futures were starting to look overextended, however, the futures have continued to move higher with price trading above our USD 12.0400 upper resistance level. Technically bullish with downside moves considered as countertrend, near-term resistance is now between USD 12.3890 and USD 12.8388. Corrective moves lower that hold at or above USD 10.3478 will support a bull argument, below this level the technical will have a neutral bias.
Coking Coal
August Futures – Technically bearish last week with upside moves considered as countertrend, the futures continue to move lower with prices now showing a small positive divergence with the RSI, not a buy signal it does warn that we have the potential to see a momentum slowdown. Upside moves that fail at or below USD 324 will leave the futures vulnerable to further tests to the downside, above this level the technical will have a neutral bias. Technically bearish with upside moves considered as countertrend. Near-term support remains unchanged at USD 232 and USD 208.