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The copper futures contract traded on the Multi Commodity Exchange (MCX) retains its prolonged sideways range movement between ₹300 and ₹340 per kg.
Within the range, the contract made a low around ₹310 on October 24 and has reversed sharply higher from there. It is currently trading at around ₹327 and is heading towards the upper end of the range.
A rise to ₹335 and ₹340 looks likely in the coming days.
A breakout on either side of ₹300-340 range will decide the next trend for the copper contract. A strong break above ₹340 will boost the bullish momentum.
Since the contract has been stuck inside this range for many months, such a break can trigger a sharp and a swift rally in the contract. It may open doors for a fresh rally to ₹380 or ₹400 there after.
On the other hand, if the contract fails to break above ₹340 this week and reverses lower, the range will continue to remain intact.
In such a scenario, the contract can fall to test the intermediate support in the zone between ₹321 and ₹318. A strong fall below ₹318 will then drag the contract lower to ₹310 or ₹305 thereafter.
Traders can stay out of the market. Avoid trading this contract until the range breakout gives out a clear cue on the next direction of move.
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