Monday, 13 January 2014

DRYS - reacting to the sharp BDI drop

Whilst the main market saw some significant declines, there was particular weakness in the shippers, not least Dry Ships (DRYS), sinking -6.2% @ $3.62. With a very sharp fall in the BDI, the recent high in the low $5s is now looking a very considerable way up.

DRYS, daily

DRYS, weekly


*first, an update on the BDI

BDI, weekly

Another 7% lower for the BDI today, and its back in the 1300s...almost a full 1000pts below the levels of late November.

It had appeared DRYS would just do a standard back test of the old $4 level...yet..with the BDI still on the slide, DRYS has failed to hold. The fact the main market is seeing minor weakness is also not helping.

Where is the next support?

The bigger weekly chart is offering next major support around current the $3.50s. A weekly close <$3.50 would be a real problem, and open the door to the $3.00 threshold...right back to mid-November levels.

Certainly, the current situation is marginal for the bulls, and the recent break back into the $3s will have seen a great many having been kicked out of their positions.