Tuesday, September 17, 2013

Bullish break out from a range

Last week we saw some fireworks in carbon, when the price was pushed up to 5.85 on short squeeze. The volume on that last push wasn't amazing and we saw nearly an instant drop down to mid 5.40s.

This week we started with double primary EUA auctions which were absorbed (surprisingly?) well. We saw certain consolidation on the market and expected it to move in a range of 5.40 - 5.60 with any risk to the upside. We never actually settled under 5.40 and any visits below that level were short lived. Two days of a range bound moves also allowed for the RSI to come down a bit from the overbought territory.

With a second look at the 15 min chart - please see the last chart above - you may actually find a small trend building up, that resulted in tonight's rally towards the close. In this bullish tone we can see the market pushing higher ahead of German elections over the weekend.

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