FIS Technical – Panamax Index Report

By
Mfame Team
-
1563

  • Index pullbacks that hold above the USD 9,499 support remain above the Fractal support and therefore bullish.
  • The June futures continue to show signs of potential exhaustion on the weekly technical.
  • However, the daily technical remains in trend above a support line, the 34 periods EMA and 55 periods MA.
  • Until the technical breaks fractal support and the trend support, any pullbacks are still only considered as corrective rather than bearish.

According to a technical report, the index remains bullish and in trend at this point with momentum indicators starting to look overextended (21 period RSI) suggesting we could see a momentum pullback soon.

Q3 report

Technically the Q3 futures remain bullish above the fractal support at USD 10,126. However, a close below this level is likely to create a bullish divergence, not a buy signal but a warning of a potential momentum slow down. Upside moves have the potential to test the recent high close of USD 10,471 but possibly needs to see the divergence come
into play first. The Bollinger band is narrowing suggesting volatility could soon rise again.

The Cal 20 futures are now technically bearish but looking overextended to the downside based on the stochastic. Upside moves that fail to trade above the EMA/fractal resistance at USD 9,470 – USD 9,544 would suggest downside continuation. Price action that closes above the USD 9,544 fractal resistance would create a fresh market high and support a strengthening technical.

Panamax Index

  • Technically the Panamax index remains bullish but is now showing signs of slowing down as it approaches the 200 period MA at USD 10,197.
  • The 21 period RSI remains in the bullish territory above the 50 lines but at 78 is starting to look overbought and needs some form of momentum pullback for the upside trend to continue.
  • From a technical perspective, the index remains in bullish territory with support at the 55-period MA and 34 periods EMA (9,161 – 8,531) with resistance at 200 MA (10,197).
  • Technical pullbacks that hold above the USD 9,499 fractal support would keep the index in the bull territory and suggest we have the potential for another move higher.
  • However, price action that closes below the fractal support would create a fresh market low indicating the technical picture is starting to weaken.

Rolling Front Month

  • The range breakout resulted in upside moves that closed at a high of USD 10,342.
  • However, the weekly chart failed to hold above the USD 9,900 resistance resulting in a small bearish rejection candle. This is not a sell signal just a warning that upside momentum is slowing.
  • The daily chart, however, remains in the bullish territory above the USD 9,517 fractal support, meaning the trend continues to remain bullish above this level, a close below this level would create a fresh market low meaning the move would be considered as corrective.
  • The June futures remain above the 55 periods MA, the 34 period MA and a trend support line, hence a fractal break is still only considered as corrective rather than bearish at this point.
  • Technically the weekly chart still looks like it needs a technical/momentum pullback as the weekly stochastic remains overbought with the 21-week RSI at 49 and in bearish territory.
  • However, if Fractal support is broken but the trend support holds on the daily chart, then we could see another test of the highs first. There are signs of exhaustion but the daily technical needs to signal the directional change in trend sentiment.

Panamax Q3 – Rolling Front QTR

  • On the last report, we noted the technical remained overbought but based on the placement of the 21 Period RSI but still had the potential to test the upside in the near term, and this has been the case.
  • In terms of the technical situation, it remains like the previous report. The new high on the Q3 resulted in a bearish divergence with the stochastic which has resulted in a sell-off.
  • However, the 21 period RSI at 52 remains in the bullish territory at this point as it looks to test the Bollinger band support at USD 10,163.
  • Note the Bollinger band continues to contract to indicate we have the potential to see higher volatility levels soon.
  • Fractal support is at USD 10,126, a close below this level would create a fresh market low and suggest the technical picture is starting to weaken.
  • This would also create a bullish divergence with the stochastic, suggesting we have the potential to test the USD 10,471 high in the near-term creating a conflicting technical. Note divergences are warnings, not trade signals.

Panamax Cal 20

  • The Cal 20 failed to hold in the bull territory and is now technically corrective with price action now making lower lows.
  • Technically corrective the Cal 20 futures are starting to look overextended to the downside based on the oversold stochastic.
  • This does not mean the Cal 20 should be considered as a technical buy as the 21 period RSI at 44 is now in bearish territory.
  • This would suggest that upside moves could find resistance around the 8 and 21 periods EMA’s (USD 9,470) or the fractal resistance at USD 9,544.
  • Technical support is between USD 9,271 and USD 9,029. A fractal break above USD 9,544 would create a fresh market high indicating a strengthening technical picture.

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Source: FIS