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(Germany => DEU)

Verified: There is a WWW signal in forecasts that could be stronger into week 9…
But later into week 9 and the start of week 10, there is a CDC risk that can be seen in ens mean => bull support

Hydbal/Inflow/Wind/Temp/Flow
- Into week 9 there is bull support and thus this will limit any bearish effect at the start of the week
WRM+PV/Jet+SRA
- There is possible a CDC development showing up later into week 9 forecasts but that’s looks to be temporary
  - Before a stable CDC setup in forecasts, we need to pass Wednesday
  - Thus into the start of week 10 we will most likely see bull weather forecasts development
  - Then the WWW risk kicks in

NC prices
- SYS price is over March and April futures supportive for bull development into the week
- NC is sensitive for WWW weather and 2 weeks solid WWW will lift Hydbal and inflow to levels that will put further pressure on prices
  - But this is not likely to be seen until week 10-12 so up to then there is a bull potential
  - Also, short positions at current NC prices and spread to DEU should be done when both NC and DEU sees a “lasting” WWW setup
DEU prices
- More wind will limit upside on DEU and in the case of WWW setup seen into week 10-12 forecasts DEU will also come down
Spread to DEU
- There is some support on SYS price later week 9 since inflow and temps come down and forecasts could show less WWW to CDC setup again
- But, this looks to be temporary and nothing to go major bull on even if the gap between NC and Germnay supports a bull shift for NC…
- For now, only NC sees above-normal wind but as DEU picks up wind later into March we will see stronger pressure on SYS price in a time with observed + moderate accum WWW forecasts into week 10-12
Fundamental market models
- SYS price vs. futures
  - SYS price and outlook this week support a bull development
- Futures vs. market models
  - Futures are priced lower than models and that supports a bull development and limits the downside risk

Week 9
- Since I don’t see a CDC setup in PV, nor in H vs low-pressures, solid WRM-CDC signal in both WRM’s and that its uncertainty for thermal/carbon any bull turn later into week 9 is not used for solid long positions
  - => There is a bull potential Wednesday-Monday when the fallback to WWW forecasts risk is lower
  - => This suggests 5-10% levels but I don’t like sitting over weekends when we shift into a new WRM period (from CDC to WWW…)
- During the week we get the necessary data that can cause a bearish pressure in NC and also DEU towards April
  - Week 10-12 looks safer for short (bearish) positions according to WRM
  - But this is more confident if we see a bull development into the start of week 10
  - Week 10-12 depends largely on the effect of the WaF (push PV to WWW-Greenland, new SSW, or a strong FSW…)
Looks to be a bearish potential for the weeks 10-12
- - => A bull turn in week 9 and into the start of week 10 will lower the risk for short positions
  - => PV positions and strength vs WaF effect into week 9 forecasts set the volumes and timing of short positions (15-30%) for week 10-12 since the WRM’s looks accumulated WWW’ish…
    - => If PV shifts to more WWW setup all over 60-100% portfolio levels will be used…
    - => If CFS hints of a new SSW verify into week 9 there is a strong bull potential for the last part of March and April

Even if March becomes WWW it does not change the outlook for Medium-term
- This part will be made statistical with price outlooks when I get a deal with a supplier
- Working on this…
NC+Germany
- Typical during SSW years we see accumulated dry weather regime throughout June for NC, and C-EU will see support form low wind over a longer period
  - CFS hints of a new SSW or a massive FSW (same effect)
  - But WaF can also shift PV to WWW position enhancing the WRM-WWW response in week 10-12
- Also, years with a strong FSW will also be supportive for a dryer path towards the summer
  - How the FSW players out the shift from year to year but the accumulated impact could be bull
- That will be supportive for NC and the large gap between NC and Germnay onwards is a bull motivator even if Hydbal is normal+ into the autumn
  - => Carbon could take a solid bull turn towards the summer if we see some longer dry and calm turns
  - From 1 of Oct the UK cable is operational…

Timing of hedging
- The gap between NC and Germany is too large and even if prices come down to “panic-mode” in shorter periods the main outlook up to summer does not support a collapse and thus we could see more bull NC prices later on
  - Late Feb and into March higher WaF supports a CDC turn into late March and April
    - => how this plays out will be crucial for March-April weather, for now, no clear WWW risk seen of the new WaF, and CFS hints of a new SSW that will be mega bull…
    - => WaF increases the risk for a strong FSW
    - => FSW has a dry impact that could take place as the FSW happens before the wet risk is seen into July-August
- 1 of Oct the UK cable is 100% operational and in 2022 the Nordlink cable increases its effect
  - =>, as we have seen the bull potential on SYS price, is high even if NO had almost 100% reservoirs the prices went mega bull as soon as inflow and wind came down below normal (week 48)
  - Panic-mode looks to be related to shorter periods when we see massive wind and inflow in NC, especially when DEU follows up with strong wind
Correction of portfolios
- Especially if we see accum dry up to June that will be needed since then the Gap between NC and Germany will be less => hedging prices are about 28-30 Euro for large companies

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