Monday, August 18, 2014

EUA Dec14: New 5-month high reached on Friday

After the huge fall the week before, the first day of last week brought a correction to the carbon market and the EUA Dec14 climbed back above the 6 euro level (and the 20 and 30DMAS at 6.14 and 6.04 euro, respectively). 
The direction was not that clear on Tuesday, a simple doji was built, but the price adhered to the 20DMA. 
Wednesday was more exciting again as the strong UK auction and lessening worries about geopolitical tensions helped the price to test the 30DMA at 6.04 euro. It climbed to 6.27 euro in the afternoon and closed just 2 cents lower.
Thursday formed other doji candle indicating some hesitation before the resistance level at 6.36 euro which was finally broken on Friday.
The MACD crossed the signal curve on the same day. The RSI is at 62 which might make investors more cautious in the near future.
Strong auction results and/or military action in Ukraine might make the EUA Dec14 test the first resistance level at 6.42 euro (last Friday's high). The upper Bollinger band is at 6.45. This is followed by 6.54 euro, a Fibonacci retracement level.
If geopolitical tensions calm down, the price could retest the support level at 6.36 euro and the 20 and 30DMAs at 6.19 and 6.10 euro respectively. The most important support level is still the 6 euro. Below that 5.90 and 5.75 could stop a depreciation.

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