Tuesday, July 31, 2012
Wake me up when September ends
Yesterday the DEC12 EUA price fell 5.6 % and hit a 7-week low. In the early afternoon the units were traded at 6.53 euro. Prices may follow this trend for the rest of the summer as the European Commission will only start to debate on the amount of the units that should be temporary withdrawn from the scheme as of September.
Since (1) in September the EC will only start the debate and the figures [number of units to be withheld] most likely will not emerge until the end of the year,(2) having in mind the still difficult macroeconomic situation, (3) governmental and EIB auctions of EUAs, (4) increased flow of CERs and ERUs into EU ETS, we do not expect the price to rise significantly this year.
As the chart above shows, yesterday the high volume was on the red candles meaning the traders were either pushing the price down, adding to the momentum or/and certain Stop-Loss orders kicked in at different levels starting from 6.85 down to 6.50. Last candle shows most likely a short covering action at the end of the session, again with high volume - a little bit of optimism during the bearish session.
This morning the prices struggle to start a correction.