Copper futures traded on the Multi Commodity Exchange (MCX) witnessed a bullish break out above ₹390/kg last week as expected. The contract has surged over 8 per cent last week breaking and decisively closing above the psychological level of ₹400. However, this rally has paused this week and the contract has been range-bound between ₹410 and ₹418. It is currently trading at the mid-point of this range at ₹414.
The immediate outlook is not clear. A break out on either side of the range ₹410-418 will decide the next leg of move for the contract. A break below ₹410 would trigger a fall to ₹407 immediately and then to ₹400. On the other hand, a strong break above ₹418 can take the contract further higher to ₹422.
Given that the contract had witnessed a sharp rally in a short span of time last week, the possibility is high for a corrective fall in the coming days before the overall uptrend resumes. Having said this, the near-term bias is bearish to see a break and fall below ₹410 towards ₹407 and ₹400. Traders can go short on a break below ₹410 with a stop-loss at ₹413 for the target of ₹403. However, the overall uptrend that has been in place since February remains intact. So a break and fall below ₹400 looks unlikely. As such the uptrend can resume again from ₹400 levels.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading.
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.