The waters calmed yesterday with the market enjoying some consolidation following a dip beneath 25.00, and the same pattern of trading was maintained as we resumed with Jul’23 retreating from an early high at 25.36 to sit quietly ahead of 25c through the later morning. Volumes were discernibly lighter than in recent days, and it seems that the trade have stepped to one side for the moment, content to look towards the consumer interest lying beneath 25c to support the environment while they along with spec longs sit on in-the-money positions and assess from the side-lines. The onset of the Americas day drew a little more activity and volatility to the environment with prices dipping to 24.95 before recovering sharply against short covering, though with the market holding within the confines of yesterday’s parameters the inside trading day will have been viewed positively by the bulls as it serves to stem the decline. Prospects of an inside day were ended during the final 30 minutes, with an aggressive push back up 25.66, and while settlement was a small way shy of the highs at 25.52 following some late position squaring the late action should serve to re-ignite the positive narrative.
The market made efforts to re-engage the upside with an early push to $694.10 for Aug’23, however the move seemed to be driven by hedge lifting and once complete there was a drift in values back to the upper $680’s where we remained for the rest of the morning. Having fallen from the contract highs an element of consolidation is to be expected as it allows for a further unwinding of the overbought technicals, and so while todays rangebound drift was tedious for many participants it will have pleased bulls in that it helps to develop a platform from which they can potentially investigate higher again. Little changed until the middle of the afternoon when some light buying interest stepped in to pull prices back above $690 and put a little more gloss on a quiet showing, though what followed during the final hour was still unexpected when it occurred. Buyers pushed with some fresh vigour to chase prices up to new daily highs, and as momentum quickly gathered so Aug’23 extend sharply ahead to be challenging the $700 mark ahead of the close. In the event we fell short of this mark with daily highs at at $699.50, though a strong settlement level of $697.80 places the market well to potentially move back above $700 ahead of the weekend.
