Capesize
September Futures – Technically bearish last week but moving higher on a positive divergence. The futures failed to trade above the USD 25,655 resistance resulting in price trading to a low of USD 13,750. The positive divergence on the daily technical has now failed, warning the USD 11,625 support could be tested. Upside moves that fail at or below USD 18,370 will leave the futures vulnerable to further tests to the downside. Above this level, the technical will have a neutral bias. Only above USD 20,750 is the intraday technical considered to be bullish. Technically bearish, the futures rejected the resistance area noted in the technical report last week (10/8), and the divergence is now failing on the daily chart. We have a minor divergence on the 240 min intraday chart. If this fails, the probability of the futures trading down to the USD 11,625 – USD 11,415 support zone will increase.
Panamax
September Futures – Technically bearish but not considered a technical sell last week with upside moves considered as countertrend, the futures traded up from USD 17,300 to a high of USD 18,700 before trading lower again. The futures are now testing the USD 16,500 low; if broken, it would suggest we see a wave 5 extension, meaning we have a potential downside target based on William’s approach at USD 11,752. However, a new low will indicate the minimum requirement for wave/phase completion will have been met due to the futures creating a positive divergence with the RSI. Upside moves that fail at or below USD 25,657 will leave the futures vulnerable to further tests to the downside. Above this level, the technical will have a neutral bias. Technically bearish, USD 16,500 is the key near-term support (currently trading at USD 16,625); downside moves below this level will have bearish implications in the near term, but the divergence will need to be monitored.
Supramax
September Futures – Technically bearish last week with upside moves considered to be countertrend, the futures have traded to a high of USD 19,925. Upside moves that fail at or below USD 22,120 will leave the futures vulnerable to further tests to the downside; above this level, and the technical will have a neutral bias. Only above USD 24,600 will confirm that the futures have entered a higher timeframe wave 4. Our intraday Elliott wave analysis suggests that the upside move is potentially countertrend at this point. Downside movements below USD 18,250 will warn the USD 17,500 low is likely to come under pressure. Bearish but momentum is currently to the buy-side with key resistance at USD 22,120.
Oil
October Futures – As noted last week, we looked to have potentially seen a phase completion based on the five lower waves; however, upside moves that failed at or below USD 104.59 would leave the futures vulnerable to further tests downside and potentially into a bearish 5th wave extension. We traded to a high of USD 100.38 before moving lower on 12/08 on the back of USD support. Price sold lower in the Asian session (Monday) due to weak Chinese data and a surprise rate cut. We have now traded back down to (but not below) the USD 92.78 fractal low, and if we trade below this level, it will have bearish implications as we advance, signalling a 5th wave extension. A new low would mean we have a potential downside target in the near term at USD 83.18. Until we trade below USD 92.78, key resistance remains unchanged at USD 104.59; however, if we trade below USD 92.78 (currently USD 93.16 on 15/08), then key support will drop to USD 100.38. Above this level, the daily technical becomes bullish. Technically bearish with support looking like it could soon be broken.
Iron Ore
September Futures – Sideways action for most of the week with price now moving lower on the back of weak Chinese data. Our Elliott wave analysis suggested that the upside move is countertrend, and this is looking to be the case. The futures have failed to make new highs with price now testing the USD 104.25 support; downside moves below this level will warn that the USD 95.50 fractal low is vulnerable. Likewise, upside moves that fail at or below USD 129.29 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 futures rolling over to the downside, market sellers will want to see a price below the USD 104.25 level.
Steel
September Futures – Technically bearish last week with resistance levels starting to look vulnerable (USD 890- USD 981), the futures traded to a high of USD 875 before correcting again. We remain in a rangebound environment between USD 890 – USD 812, indicating a neutral bias on the technical. Downside moves traded below USD 812 will create a positive divergence with the RSI, meaning we maintain our view that the futures are not considered a technical sell on a new low. Upside moves above USD 890 will warn that buy-side momentum is improving. Technically neutral.
Tankers TD3
September Futures – Last week, we noted that the futures were vulnerable to a test to the upside in both the August and September contracts, with the price looking like it was in a countertrend wave 4. The downside move in the futures held EMA support and is now moving higher; upside moves above USD 13.3120 will target the USD 13.8589 resistance in the near term, with a potential upside target (using William’s approach) as high as USD 15.1977. If we trade below USD 11.6920 before trading to a new high, the futures will remain in a complex corrective wave 4, with key support holding at USD 10.7717. Technically bullish with the futures needing to confirm that we are on a bullish Elliott 5th wave. Upside moves that do make a new high will create a negative divergence with the RSI; this will need to be monitored as it warns of the potential for a momentum slowdown.
Coking Coal
September Futures – We noted last week that the futures had traded to a low of USD 203 with price in divergence, warning we had the potential to see a momentum slowdown. The futures closed last week at USD 248. Technically we remain bearish with a neutral bias; upside moves above USD 255 will mean the technical has entered bull territory. The RSI is below 50 (44) with the stochastic in the overbought territory; momentum is warning that the futures are vulnerable to further tests to the downside. If the RSI moves above 50, the stochastic becomes less relevant; downside moves that hold at or above USD 218 will support a near-term bull argument. Below this level, the futures will target the USD 203 low. Technically bearish but with a neutral bias.