Week 38: Without clear fundamental direction, EUAs watch technical signals

We have a neutral view for the EUA Dec-23 contract for the week ahead. With Norwegian gas outages scheduled to end and a cessation in industrial action at the Chevron Australia’s LNG facilities, the volatility in the gas market will be less likely to impact carbon. New forecasts pointing to warmer temperatures next week and through October limit heating demand. Without clear fundamental direction, technical indicators and market participant behavior are more likely to drive EUA prices.