Wednesday, January 15, 2014

BDI Baltic Dry Index Negative Divergence Island Reversal Sideways Channels

The negative divergence spank down occurs (red lines) as forecasted late December. If the ocean ships are not transporting, grains, coal, coke, iron ore, steel, rubber, etc..., then the global economy is not doing as well as thought. Everyone is used to China carrying the global water for so many years that it is taken for granted; right when growth is likely slowing. The red lines for the indicators are weak and bleak so lower lows are desired after any bounce occurs.

Note the island reversal pattern where price jumped from 1350 to 1500 to create an island from September forward, and now price collapsed back down through the gap creating the island reversal. The 200-week MA continues to slope downward which remains a negative. The green horizontal support lines will likely direct price sideways through the year ahead. Commodities will play an important role if the global economy is going like gangbusters, but, from the chart above, the interest in raw materials appears to be waning rather than ramping higher. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

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