Exchange prices have reached new heights during the first week of the month, which appeared fully bullish. Prices of DEC22 EUAs rose 7,91% compared with July’s latest session, reaching peaks at 85,45 €/ton for DEC22. However, volumes remained low and further decreased from July, reaching minimum liquidity of 11,8 million certificates traded on the first day of the month: it is the lowest since June 3rd.

At the beginning of the month, a strong resistance was identified around 85,50 €/ton, which represented DEC22 before the collapse of July 19th, and during the session of August 5th, it stopped the bullish run of EUAs. The support at the time laid close to the 50- and 100-day moving averages, which were convergent and extremely close to each other, around 83 €/ton.

The rest of the month remained very volatile, as it historically happens during the summer. EUAs during the first half of August had completely canceled the losses, which started on July 20th, and prices continued to rise throughout the month, reaching new historical highs at 99,22 €/ton on August 19th.

After this peak, during the third week of the month, the front-year contract saw a physiological retracement, an inversion of the short-term trend, and a depreciation of 7,86%: EUAs went back to trade slightly above 88,00 €/ton on Friday, August 26th. The DEC22 EUAs were in the hyperbought area when they reached the new price records, and it was predictable that quotations would have decreased.

In the last days of August, strong support was identified around the 20-day moving average, around the 89 €/ton area. The resistance was placed around the 92,50 €/ton level, where we saw a bearish pullout on the 23rd of the month (a phenomenon describing old support becoming a new resistance).


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Francesco Rogato

With his commodity trading experience, specializing in the energy sector, and extensive knowledge of European exchange platforms and Over-The-Counter markets, he brings his advanced analytical view on the EU ETS carbon market in a monthly short blog, “Let’s Talk Carbon”.