Monday, April 14, 2014

EUA Dec14: Shortened week with tightened supply

The EUA Dec14 moved sideways since the beginning of April in a range of 4.60 and 5.18 euro, the 200DMA stopping it from appreciating further. The range was first broken on Thursday, when the benchmark contract closed above the upper edge of the range. The momentum survived on Friday when the MACD crossed the signal line, confirming the reversal of the trend. The RSI is at 47, in neutral territory.

EIB sales are expected to end this week (Monday or Tuesday) decreasing the daily volume offered by one million. This is a week without UK auction on Wednesday and there will be no German auction on Friday either due to Good Friday and banking holiday in Germany.

If the price continues its path upwards, it has to brake the following resistance levels: 5.36 (the 20DMA), 5.56 (the 50% Fibonacci level), 5.66 (the low from 17th March) and 5.83 (the 30DMA).

In a negative scenario the support levels at 5.00 (psychological level), 4.58 (23.6% Fibonacci level), 4 (the low from 31 March and a psychological level) and 3.71 (the low from 28 March) can stop it from depreciating.

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