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The Lead futures contract on the Multi Commodity Exchange (MCX) has been stuck inside a sideways range over the last several weeks.
The contract has been range-bound between ₹155 and ₹168 per kg for about two months.
Within this range, the contract made a low of ₹155.65 on Friday last week and has bounced sharply from there.
It is currently trading at ₹161/kg.
The sideways range remains intact. As long as the contract trades above ₹159, there is a strong likelihood of it moving higher to test ₹168 — the upper end of the range in the coming days.
Whether the contract breaks above ₹168 or not will decide the next move. Inability to break above ₹168 and a pull-back move will continue to keep the contract inside the sideways range for some time. In such a scenario, a fall to ₹160 and ₹155 is possible again.
But, if it manages to break above ₹168 decisively, it can gain fresh momentum.
Such a break can take the contract higher to ₹171 initially.
Further break above ₹171 will increase the likelihood of the upmove extending to ₹175.
However, the outlook for the contract will turn negative if it declines below ₹155.
Such a break can drag the contract lower to ₹150.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading.
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