Baltic Dry Index Holds Near Middle of Recent Trading Range

| September 18, 2010

The Baltic Dry Index (BDI) rebounded sharply in August following the uptrend breakdown in June, but it has now struggled in the 2,800 area for the past month.

A subsequent breakout above the recent high at 3,000 would forecast a return to long-term highs near 4,000 and support a continuation of the consolidation pattern experienced by global equity markets since late 2009. However, if the developing reversal gains strength and the index moves down toward recent lows, a long-term breakdown in the stock market during the next few months would become more likely. It will be important to monitor the direction of the BDI during the next several weeks.

Category: Commentary, Market Update

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