Failing to break above 5.57, carbon prices retreated and moved in the channel as indicated earlier – compare please with previous post. Late last night market took a deep dive, following declines in power, oil and gas prices. In addition to that, an announcement that German government may not be formed until January next year, may have cooled down the hopes for quick move on backloading. Certain profit taking at the end of the quarter could have played its part as well.
We saw some further weakness this morning, with prices falling under 5.00 euro for a blink of an eye. We may see some psychology influencing the trading today again, as 5.00 euro may be an appealing level for utilities to buy. Market seem to be testing 5.15 for a support or resistance. We have 30 DMA (Daily Moving Average) at 5.05 providing some ground. Next support potentially at 4.90.