There was no sign of the buying which made yesterday so interesting as the market resumed by falling back to the 19.60 area. The COT had shown a little more short covering than some had anticipated to leave the net spec position showing at -56,056 lots, and though a little more was likely covered in yesterday there clearly remain a core group who have no current intent to cover and so continue to limit the amount of movement generated into the producer scales. From a morning low at 19.49 the Oct’24 contract did return to hold the 19.60’s but the start of the morning soon rendered these efforts obsolete as the price spiked down to 19.33 on day trader stops and algo interest. This did not immediately deter the bull and incredibly the price was hauled back up and briefly traded at 18.70 before another pullback once the momentum had stalled. This took the sting from the market and the final 3-hours proved much quieter despite the rage widening further. Lows were recorded at 19.22 but safely back in the range there was a clear drop off in participation with the usual suspects retuning to the foreground. There was some short covering / defensive buying during the final hour as Oct’24 ended the session at 19.49, a lower close but not so bad as it may have been.
Despite ending yesterdays session strongly there was no continuation when trading resumed as the market settled down into a narrow band just beneath overnight levels. This set the tone for a quiet morning and though Aug’24 slipped back to $565.90 at one stage there remained a desire to try upward and so prices returned to the upper $560’s as the US morning loomed. Rather than continue upward this period simply brought some selling with crashing back by $6.50 on just 270 lots, emphasising the unwillingness of consumers to price at the higher levels and leading to the lack of sustained buying necessary to continue. Despite a small effort from longs to re-engage the market there was now sufficient damage done for others to begin liquidating recent longs and so the afternoon increasingly saw the price retreat back through yesterdays range. Spreads were similarly giving back their gains and by late afternoon Aug’24 was trading almost $14 lower at $556.20. Prices tracked up a little during the final hour, while a late push (position squaring) sent Aug’24 back into the $560’s late on with a settlement made at $561.70.
