POWER: Nordic August Power Tracks Nearly 13% Weekly Increase
Nordic front-month power futures are tracking a 12.6% weekly net gain with support from neighbouring markets and downward revisions in the region’s hydro balances. Front-month futures are edging up on Friday morning.
- Nordic Base Power AUG 25 up 0.2% at 30.4 EUR/MWh
- Germany Base Power AUG 25 down 0.1% at 82.01 EUR/MWh
- EUA DEC 25 down 0.1% at 70.64 EUR/MT
- TTF Gas AUG 25 up 0.1% at 35.2 EUR/MWh
- The Norwegian hydro balance has been revised down to end at 2.14TWh as of 25 July, from 2.72TWh in the previous forecast. The overall balance is trending lower but remains well in positive territory.
- Sweden’s hydro balance has also been revised lower to end at 1.32TWh as of 25 July, from 1.63TWh forecasted before.
- Forecasts suggest precipitation in the Nordics has been revised down with above-normal rainfall at the start of next week, before dropping below the average later next week.
- Mean temperatures in the Nordics are forecast at 17.2-20.1C over 12-26 July.
- Nordic nuclear capacity was at 74% of capacity on Friday morning, unchanged from Wednesday, according to Bloomberg. 9 of the 11 units are still online.
- The 1.12GW Forsmark 2 nuke is having planned maintenance until 21 July.
- The 1.4GW OS3 nuke will still have planned works until 3 September.
- Closer in, Norwegian wind is forecast at 195-870MW during base load over 12-18 July according to SpotRenewables.
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GOLD TECHS: Short-Term Weakness Appears Corrective
- RES 4: $3578.0 - 2.000 proj of the Dec 19 - Feb 24 - Feb 28 swing
- RES 3: $3547.9 - 1.764 proj of the Feb 28 - Apr 3 - Apr 7 price swing
- RES 2: $3435.6/3500.1 - High May 7 / High Apr 22 and bull trigger
- RES 1: $3403.5 - High Jun 5
- PRICE: $3336.1 @ 07:25 BST Jun 11
- SUP 1: $3245.6 - 50-day EMA
- SUP 2: $3121.0 - Low May 15 and key support
- SUP 3: $3085.0 - 61.8% retracement of the Apr 7 - Apr 22 upleg
- SUP 4: $3100.0 - Round number support
A bullish theme in Gold remains intact and the latest pullback appears corrective. Medium-term trend signals remain bullish - moving average studies are in a bull-mode position, highlighting a dominant uptrend. A resumption of gains would refocus attention on $3435.6 next, the May 7 high. A break of this hurdle would strengthen bullish conditions. On the downside, the next support to monitor is $3245.6, the 50-day EMA.
BRENT TECHS: (Q5) Bull Cycle Remains In Play
- RES 4: $75.33 - High Feb 20
- RES 3: $73.88 - High Apr 2 and a bull trigger
- RES 2: $70.08 - 76.4% retracement of the Apr 2 - 9 sell-off
- RES 1: $68.00 - High Jun 10
- PRICE: $66.88 @ 07:10 BST Jun 11
- SUP 1: $62.09/57.78 - Low May 30 / Low April 9 and the bear trigger
- SUP 2: $55.88 - 2.236 proj of the Feb 20 - Mar 5 - Apr 2 price swing
- SUP 3: $54.70 - 2.382 proj of the Feb 20 - Mar 5 - Apr 2 price swing
- SUP 4: $54.00 - Round number support
A bull cycle in Brent futures remains in play. The latest round of gains has resulted in a break of resistance at $65.45, the 50-day EMA. The continuation higher exposes $70.08, a Fibonacci retracement. It is still possible that the recovery since early May is a correction. Moving average studies are in a bear-mode position, highlighting a dominant medium-term downtrend. Support to watch lies at $62.09, the May 30 low. A break would be bearish.
BUNDS: US CPI is at the forefront
- As to be expected, not too much change for the German Bund contract with the Street fully focused on the US CPI Today, the main Data release for the Week.
- While negotiations between the US and China on de escalation of the Trade War, with a preliminary plan to resolve issues of rare Earth shipments are still ongoing, a Federal appeal Court decided that Trump can continue enforcing his Global Tariffs for now, as such uncertainty in Trade Wars remain.
- Technically for Bund, the initial resistance of 131.00 is still holding for now, above the latter would open to 131.28, followed by 131.50.
- Small support moves up to 130.52, although most could look at 130.37, Yesterday's low, but the near term key level is still at the 2.60% mark in Yield, this equated circa 130.10s for the the past couple of sessions.
- There's only the ECB Wage tracker this Morning, but unlikely to move the needle, it is all about the US Inflation Today.
- SUPPLY: UK £4.25bn 2035 (equates to 36.5k Gilt) will weigh, Germany €3bn Bund (equates to only 24k Bund) should have no real impact, Portugal 10s, 30s (too small, won't impact Bund at least). US sells $39bn of 10yr Reopening.
- SPEAKERS: ECB Makhlouf, Cipollone, but with the continued uncertainty in Tariff Wars don't expect anything too new.
