Tuesday, April 7, 2015

Less than expected fall in 2014 VE pulled the EUA Dec15 up 4% w/w

The EUA Dec15 appreciated by 1.8% last Monday, although the volume of 7 million allowances was less than half of the volume of the weakest day of the week before. The 30DMA at 7.00 euro provided the first strong resistance the price had to break. From the downside the price was well supported by the 20DMA at 6.84 euro.

The EUA Dec15  fighting with the 30DMA on Wednesday morning as well. Volumes and intraday ranges were significantly below last week’s levels. 2014 verified emissions, however fell by 4.9% only, significantly less than the median expectation of analysts of 5.5%. As a consequence, the benchmark contract jumped to 7.26 euro, finally breaking the 30DMA. 

The price cimbed one cent higher to 6.27 euro Thursday in the morning, reaching levels above all the moving averages. The MACD reached the positive territory as well. 

The short term technical picture looks good with the MACD above zero and the 20DMA being close to cross the 30DMA. 

Looking at the price from a wider perspective, however, the benchmark contract moves in a range of 40 cents between 6.80 and 7.20 euro.

We expect a short and calm week with the price possibly moving in sideways above the 30DMA, currently at 6.95 euro.

Although there are no official meetings scheduled for discussing the MSR, we have to watch out for rogue comments or leaks from officials, MEPs or ministers which might flip the price one way or another out from the range mentioned above. 

Source: Bloomberg Finance L.P.

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