Capesize
June Futures – Last week we noted that the RSI on the 4-hour chart had produced a negative divergence, warning of the potential for a momentum slowdown, with downside moves below USD 36,500 indicating the futures had entered a corrective phase. We also noted that any corrective move lower had the potential to be countertrend. Price traded below the USD 36,500 support level to a low of USD 34,625; however as highlighted in the morning technical (16/05) if the RSI, which was near neutral moved above 50 then momentum was vulnerable to a test to the upside. Upside moves that fail at or below USD 37,674 will leave the futures vulnerable to further tests to the downside, above this level we target the USD 39,250 high. Corrective moves lower that hold at or above USD 29,020 will support a bull argument, below this level the futures will have a neutral bias. Technically bullish but in a corrective phase, key support, and resistance levels to follow are USD 37,674 and USD 29,020.
Panamax
June Futures – Elliott wave analysis last week suggested we were on a bullish impulse wave 5 of this phase. However, the new high meant the futures had created a negative divergence with price, warning we had the potential to see a momentum slowdown, whilst downside moves below USD 28,875 would mean price had entered a corrective phase. The futures did move lower with price trading to a low of USD 27,375, corrective moves that hold at or above USD 26,620 will support a bull argument, below this level the daily technical will have a neutral bias, warning the USD 24,750 fractal support could be vulnerable. Likewise, upside moves that fail at or below USD 29,272 will leave the futures vulnerable to further tests to the downside, above this level we target the USD 30,250 high. Technically bullish but in a corrective phase, market bulls will want to see the USD 26,620 support hold if tested.
Supramax
June Futures – Near-term bullish last week with the longer-term technical continuing to have a neutral bias, downside moves below USD 33,200 warned the intraday technical is weakening, leaving the USD 30,750 and USD 28,250 support levels vulnerable. The futures traded below the USD 33,200 support to a low of USD 31,175, the technical remains bullish but with a neutral bias. A close today (16/05) above USD 31,933 (currently USD 31,750) will mean the momentum based on price is starting to strengthen; however, upside moves that fail at or below USD 32,965 will leave the futures vulnerable to further tests to the downside, above this level we target the USD 33,875 fractal resistance. We have now had two bullish waves since the 06/04/22, both of which only consist of 3-waves on the intraday technical. This is warning that the recent upside move is potentially part of a longer-term corrective phase, warning support levels could be tested. Technically bullish but with a neutral bias, support levels could be vulnerable here based on the recent price action since early April.
Oil
July Futures – the USD 114.00 resistance level held last week resulting in the futures producing a technical pullback. We noted that there is a lack of trend based on the daily EMA support band (support band last week was USD 107.67 – USD 104.61), making this a dangerous area to enter a short position. The futures did trade through the band to a low of USD 101.30, however the downside move failed to hold, resulting in the futures moving aggressively higher, to USD 112.70. The technical continues to have a neutral bias, upside moves above USD 114.84 will target the USD 123.74 fractal resistance; likewise, downside moves below USD 101.30 will target the USD 99.48, USD 97.57, and USD 96.93 fractal support levels.
Iron Ore
June futures – We noted last week that the futures remained vulnerable to further tests to the downside as the RSI had made new lows. The futures have traded to a low of USD 121.35 with intraday wave analysis suggesting we have seen the corrective wave 3 extend. This would suggest that upside moves that fail at or below USD 138.76 remain 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 at this point, as wave analysis would suggest there is further downside price action to come within this cycle.
Steel
June Futures – Technically unchanged from last week. The futures have tested and held above the USD 1,169 support for a second time, downside moves below this level will target the USD 1,086 and USD 947 support levels. Likewise, upside moves that fail at or below USD 1,455 will leave the futures vulnerable to further tests to the downside. If the USD 1,169 support holds then then we have the potential to see the futures start a new bullish Elliott wave cycle, however if broken, the probability of the futures entering a new bull cycle will decrease. Technically bearish, the futures are currently consolidating around a key support.
Tanker TD3
June Futures – Technically neutral last week based on the deep pullback in the futures. Price failed to trade above the 8-21 period EMA’s resulting in the USD 9.0323 support being broken, warning the USD 8.2730 level is now vulnerable. Upside moves that fail at or below USD 10.7983 will remain vulnerable to further tests to the downside, above this level the futures target the USD 11.8210 high. Both the RSI and its moving average are below 50, warning that momentum continues to weaken, suggesting upside resistance levels (USD 9.9621, USD 10.3170, and USD 10.7983) should hold if tested. Technically neutral, with momentum weakening, downside moves below USD 8.2730 will be bearish.
Coking Coal
June Futures – last week we highlighted a small 5 wave pattern that warned that the futures had the potential to exhaust whilst the RSI was showing a negative divergence supporting this. Price has since moved sideways with the futures on the 8-period EMA but still below the USD 495 resistance. Upside moves above the resistance level will target the USD 535 high; likewise, downside moves that trade below the USD 425 level will warn the USD 373 and USD 348 support levels could be tested. Technically neutral, we maintain our view that the futures remain vulnerable to a test to the downside.