Initial hedge lifting meant a marginally higher opening though this was quickly concluded to leave the market once more testing the downside support. As with yesterday there was solid buying in place with the price holding at 19.28 for a large part of the morning before kicking down to 19.21 when a short burst of spec selling emerged, though any further losses were avoided until the arrival of Americas based specs/traders. The price then chopped around as fresh selling extended the losses to 19.11 before recovering back to 19.28 soon after (suggesting day trader/algo involvement) though this was merely an interlude before the downward trend resumed, targeting last November’s 19.05 low. With the generally positive macro holding no sway as our own technical picture drove movements the scale buying continued to be filled in, delighting end users as they took advantage of the best pricing opportunity in two months. The buying volume increased in the 19.05/19.00 band though this was ultimately filled in to answer the question of whether there would be any sizable stops beneath 19.00. The answer was no with the market touching to 18.95 before pausing, though there was no significant recovery as selling continued to ensure a close to the bottom of the range. March/May’23 was pushed down to 1.04 points on the close while March’23 settlement was made at 18.96 with a marginal new low of 18.94 recorded going out to end the week poorly. Tonight’s COT report will be keenly anticipated to assess just how much of the fund long has so far been reduced from last week’s +223,000 lot long holding, with estimates then to follow for the past three sessions which have seen a larger fall in price on greater volume than the preceding period.
A new day but there was a very familiar picture unfolding over the first couple of hours with prices continuing the recent slow and steady grind down to take March’23 to $532.00. A moderately firmer macro was providing no assistance with the weakness encouraging more spec long liquidation, assorted pushes lower extending the range down to $529.10 by early afternoon. Many longs remain hopeful that the decline can be halted/reversed and defensive buying followed this low to recover most of the losses however with little buying of significance following behind it was not long before the downward trend resumed. New lows were recorded moving through the final few hours, bringing the March’23 spreads under pressure also (March/May’23 trading in to $12.40) as the flat price reached $527.00. The picture appeared weak as we headed through the final hour though there were to be no fresh lows going out despite settlement being made just 0.20c from the low at $527.20, with last trades a couple of dollars above this level due to some late buying/position squaring. Support remains through to $522.20 basis the late November lows with the market continuing to appear vulnerable.