The aluminium futures contract on the Multi Commodity Exchange (MCX) is struggling to gain strength. The contract has been inching up slowly in recent weeks from its low of ₹121.6 per kg on March 14. But this bounce-back is under pressure: the contract reversed sharply lower on Monday. The contract was down 1.7 per cent on Monday to touch a low of ₹124 per kg. It recovered from there and is trading at around ₹125.1 a kg. An inability to extend this bounce-back from the current level can keep the contract under pressure. The immediate support is at ₹124. A break below this level can pull the MCX-Aluminium contract lower to ₹122 or ₹121. The 21-week moving average support is at around ₹121. A strong break below this support may increase the downside pressure. In such a scenario, the contract may fall to ₹120 or ₹119 initially. A further break below ₹119 will increase the likelihood of the contract tumbling to ₹116 thereafter. However, such a sharp fall looks unlikely at the moment. A strong reversal from the 21-week moving average support could take the contract to ₹125 and ₹126 levels once again. The region between ₹126.5 and ₹127 is a key resistance zone. A strong break above ₹127 is needed to gain fresh momentum. Such a break can take it higher to ₹130, a key long-term resistance level. A decisive weekly close above this may pave way for a fresh rally to ₹135 or even ₹140 over the medium term.

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