Monday, March 3, 2014

EUA Dec14: RSI came back to normal levels, but buyers still dominant

The one-month increasing trend stopped last week after the European Council absolved the last necessary step in the process of back-loading. On the day of the decision the benchmark contract hit 7.33 euro, but later only the 7 euro level could maintain the price fall, and on the next day the EUA Dec14 fell more than 11% and closed below the 20DMA. MACD produced a bearish crossover on the same day. Wednesday also started in a negative mood, but the price managed to post a d/d gain and closed above the 20DMA. Next day saw prices treading water, only the afternoon saw some buyers arriving to the market. The publication of the amended auction calendars made the EUA Dec14 open with a gap (6.57/6.70 euro) on Friday and the price climbed back above 7 euro again. 

The MACD turned back north, but didn’t cross the signal. The RSI – after falling to 51 on Tuesday increased to 64 on Friday.

Should the positive mood persist, the next resistance levels are at 7.14 euro (the opening and maximum price from Tuesday from where it fell 11%) and 7.33 euro (the local high hit on Monday). After this level there is open room to increase to 8 euro.

If more installations receiving their allocation opt for selling, the next support levels can be the gap left on Friday (6.57/6.70 euro), 6,18/6,20 euro (the low from Wednesday and the 30DMA).

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