By Mathew Carr
April 9 (Bloomberg) -- European Union emission permit prices may extend gains after reaching their highest in almost three months today, Evolution Markets Inc. said, using a Fibonacci chart to make forecasts.
Carbon for December delivery exceeded 13.25 euros ($17.60) today for the first time since Jan. 16. That price is a 61.8 percent retracement of the decline from 16.45 euros on Dec. 17 to a record low of 8.05 euros. Should the contract close twice above 13.25 euros, prices will have a base to rally toward 16 euros, said Brett Genus, a broker for Evolution in London.
Fibonacci charts use the ratio between numbers in the sequence identified by 13th-century Italian mathematician Leornardo Fibonacci. The ratio, known as the golden mean, locates points of support or resistance as prices retrace rallies or declines between previous high and lows.
EU carbon dioxide allowances for December climbed as much as 5.6 percent to 13.50 euros a metric ton on London’s European Climate Exchange, the highest since Jan. 15. They traded at 13.20 euros as of 10:34 a.m. local time.
“I think we will have another run at 13.25 euros next week,” assuming the market closes below that level today, before the Easter holiday weekend, said Dennis Mignon, a trader with First Climate in Bad Vilbel, Germany, by telephone. “If we bounce off and head towards 12 euros again, this will be a negative signal.”
To contact the reporters on this story: Mathew Carr in London at m.carr@bloomberg.net
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