Daily Market Price Updates and Commentary 10th February 2025

Unchanged opening values soon developed into another push higher with March’25 quickly working up to 19.54. A pause in the progress did not change the general direction of movement with the market finding some additional buying interest through the late morning and into the afternoon which extended the move up into the 19.70’s. This movement was again being driven by the smaller specs, however the larger funds remain absent for the time being with no desire to cover back any significant quantities of their short holding which stood at -127,092 lots as at last Tuesday and likely remains in the same area now. With some scale selling starting to show at the upper levels the market stalled and returned to the 19.60’s, and while another effort higher followed it too failed at 19.79 and led to more long liquidation. Two failures were enough for the buyers and so the rest of the session played out within the range as the market slowly tracked back down, leaving the index roll to take centre stage with spread values increasing through the afternoon. Here was saw March/May’25 range between 1.48 and 1.65 points on a daily volume of 57,000 lots, though by the time that the close arrived the value was only a few points higher at 1.53 points. March’25 meanwhile limped along to finish the day at 19.50, a solid 0.14-point gain but one which felt neutral with the market still constrained by recent parameters and in a state of limbo awaiting to see whether the Dubai conference can provide some fresh dynamic. 

It was a calm start to the week with May’25 trading either side of unchanged initially before beginning to find some fresh buying interest as we approached the middle of the morning. This merely took the price up to the $505.00 area however its impact became more significant moving through noon with some continuation spec buying arriving to build from this base and take the price back up in an effort to move beyond last Fridays highs and generate better momentum. For a period such a scenario seemed possible as May’25 reached $509.80 on two separate occasions, however the necessary interest was lacking when it mattered and so long liquidation arrived to drop values back down into the range. Alongside this disappointing turn of events for the flat price there was still some strong volume being seen for the March’25 contract which has less than four sessions remaining until expiry. That should not surprise with the open interest still standing at a high 19,211 lots, though todays activity which saw another sizable March/May’25 roll volume alongside outright activity and AA postings will be sure to mark a reasonable reduction in that number overnight. The outright decline continued to be gradual, and by the end of the afternoon values had eroded virtually all the earlier gains. This left May’25 closing only a small distance higher at $503.60 to conclude a neutral inside session, with March/May’25 going out at $15.80 and the May/May’25 premium valued lower at $107.50.