The European power spot prices dropped yesterday, pressured by forecasts of surging wind output and warmer temperatures weakening the power demand. The baseload day-ahead prices averaged 160.42€/MWh in Germany, France, Belgium and the Netherlands, -33.15€/MWh day-on-day and should continue to fall today as the German wind production is expected to climb above 35GW tomorrow.
The EUAs extended Friday’s late drop at the market open yesterday, but quickly rebounded afterwards as the gas market started to post hefty gains as a consequence of Gazprom not booking additional capacity through Ukraine during the monthly gas capacity auction. The emissions prices however retreated in the afternoon as traders took their profit in the gas market and the Dec.21 eventually closed at 58.56€/t, -0.88€/t from Friday’s settlement. The correction even accelerated after the market’s close and the carbon prices fell below both their long-term and 58€/t supports which could point toward further downside in the short-term. Prices are pursuing their downtrend this morning, but the losses could be capped by the low Bollinger band currently standing at 56.70€/t. As the large retracement does not seem fundamentally supported, a rebounded is not excluded once the bears have reached their target.
The power curve prices tracked the early gains and following retreat of the gas and carbon prices, eventually posting hefty daily losses along the curve with the largest observed on the short-term contracts.
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