POWER: Nordic March Leads Gains on Curve Amid Drier Outlook
The Nordic March is trading higher on the day as a diminishing outlook in Norway’s and Sweden’s hydro balance is lifting the product – suggesting amplified supply risks. But the 1.17GW Forsmark 3 has powered up to around 980MW this morning, with full capacity reached by 4 Feb and average temperatures in the region have also been revised up on the day – which could cap gains.
- Nordic Base Power MAR 25 up 7.9% at 46 EUR/MWh
- France Base Power MAR 25 up 1.7% at 90.06 EUR/MWh
- Germany Base Power MAR 25 down 0.4% at 105.81 EUR/MWh
- EUA DEC 25 down 1.5% at 82.7 EUR/MT
- TTF Gas MAR 25 up 0.2% at 53.35 EUR/MWh
- The Norwegian hydro balance is expected to be sharply lower on the day, with some revisions down by around 200GWh. The balance is anticipated at +4.45TWh on 17 February compared to +4.61TWh previously estimated. It is important to note that the balance is forecast at around +8.4TWh on 4 Feb.
- Sweden’s hydro balance has also been revised lower at +5.44TWh on 17 February compared to +5.45TWh in the previous estimate. This is also down from +7.27TWh estimated for 4 Feb.
- But average temperatures in the region have been revised up over 3-8 February by up to around 0.4C – with temps anticipated to remain slightly above the 30-year norm throughout the 6-10 ECMWF forecasts.
- However, rainfall in the Nordics will remain below the seasonal average from until 17 February – likely limiting flows into reservoirs.
- Closer in, Norwegian wind is forecast at 1.74GW, or a 33% load factor on 4 February – down from today's 1.89GW forecast, which could lift delivery costs.
- Nordic nuclear availability was at 98% capacity on Monday morning, up from 89% on Friday, according to Bloomberg. 11 of 11 units are now online.
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JGB TECHS: (H5) Returns Lower
- RES 3: 149.55 - High Mar 22 (cont)
- RES 2: 147.74 - High Jan 15 and bull trigger (cont)
- RES 1: 144.48/146.53 - High Nov 11 / High Aug 6
- PRICE: 142.12 @ 15:01 GMT Jan 03
- SUP 1: 141.65 - Low Dec 30
- SUP 2: 141.56 - 1.764 proj of the Aug 6 - Sep 3 - 9 price swing
- SUP 3: 141.05 - 2.000 proj of the Aug 6 - Sep 3 - 9 price swing
Markets slipped on the hawkish Fed and are yet to fully recover, touching 141.65 on the way lower. Medium-term trend signals on the continuation chart continue to point south. A resumption of the trend would pave the way for a move towards 141.56, a Fibonacci projection point on the continuation chart. A stronger recovery would open 144.48, the Nov 11 high. Further out, key resistance is at 146.53, the Aug 6 high (cont).
USDCAD TECHS: Bull Flag Highlights A Clear Uptrend
- RES 4: 1.4669 2.0% 10-dma envelope
- RES 3: 1.4539 3.382 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 2: 1.4508 3.236 proj of the Oct 17 - Nov 1 - 6 price swing
- RES 1: 1.4467 High Dec 19
- PRICE: 1.4392 @ 15:50 GMT Jan 3
- SUP 1: 1.4336 Low Dec 20
- SUP 2: 1.4307/4232 20-day EMA / Low Dec 17
- SUP 3: 1.4136 50-day EMA
- SUP 4: 1.4011 Low Dec 5
USDCAD is unchanged and bulls remain in the driver’s seat. The latest pause appears to be a flag formation - a bullish continuation signal. Note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 1.4508 next, a Fibonacci projection level. Initial firm support to watch lies at 1.4307, the 20-day EMA. A pullback would be considered corrective.
AUDUSD TECHS: Southbound
- RES 4: 0.6471 High Dec 9
- RES 3: 0.6408 50-day EMA
- RES 2: 0.6341 High Dec 18
- RES 1: 0.6247/6282 High Dec 30 / 20-day EMA
- PRICE: 0.6204 @ 15:21 GMT Jan 3
- SUP 1: 0.6179 Low Dec 31
- SUP 3: 0.6158 1.236 proj of the Sep 30 - Nov 6 - 7 price swing
- SUP 3: 0.6100 Round number support
- SUP 4: 0.6045 1.500 proj of the Sep 30 - Nov 6 - 7 price swing
A bearish trend condition in AUDUSD remains intact and the pair continues to trade closer to latest lows. Recent weakness maintains the price sequence of lower lows and lower highs. Note that moving average studies are in a bear-mode position too, highlighting a dominant downtrend. Scope is seen for an extension towards 0.6158 next, a Fibonacci projection. Initial firm resistance to monitor is 0.6282, the 20-day EMA.
