The bounce back move in the Lead futures contract on the Multi Commodity Exchange (MCX) seems to lack strength. The contract had reversed higher from the low of ₹156.2 a kg made on November 17. This bounce back move faced strong resistance in the ₹160-₹161 region. After attempting to breach above ₹161 several times in the last few days, the contract has reversed lower, and is currently trading at ₹157 .

The contract will gain fresh momentum only on a strong break and a decisive close above ₹161. Such a break will ease the downside pressure and take the contract higher to ₹167 or even to ₹170 thereafter.

Short-term traders with a high-risk appetite can go long on a decisive break above ₹161. Stop-loss can be placed at ₹159.5 for the target of ₹166. Revise the stop-loss higher to ₹162 as soon as the contract moves up to ₹164.

On the other hand, if the MCX Lead futures contract continues to trade below ₹161, it can remain under pressure. In such a scenario, there is a strong likelihood of it falling to ₹154.5 in the coming days. A break below ₹154.5 can pull the contract further lower to ₹153. The level of ₹153 is a crucial medium-term trend-line support which can halt the down move. A strong upward reversal from this support level of ₹153 may have the potential to take the contract to ₹160 or even higher levels again.

Note: The recommendations are based on technical analysis and there is a risk of loss in trading

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