The crude oil futures contract traded on the Multi Commodity Exchange breached a key support at ₹5,700/barrel last Friday. It is now heading towards the next significant long-term support at ₹5,500 levels.

The contract has been on a medium-term downtrend since encountering a key resistance at ₹6,500 levels in late June this year.

It is trading well below its 50- and 200-day moving averages. Moreover, the short-term trend is also down for the contract. Outlook is bearish.

Therefore, traders with a short-term can sell the contract on rallies while retaining a fixed stop-loss at ₹5,720 levels. Targets are ₹5,550 and ₹5,500 levels. A decisive fall below ₹5,500 can drag the contract down to ₹5,400 levels. Strong resistance beyond ₹5,700 is pegged at ₹5,840.

MCX-natural gas: The MCX-natural gas futures contract took support around ₹229 and bounded up forming a bullish engulfing candlestick pattern on Monday. Subsequently, the contract surpassed the 21- and 50-day moving average and started the trend northwards.

The contract can extend its up move and reach the price target of ₹250. Traders can make use of dips to buy the contract with a stop-loss at ₹233 levels. Strong rally above ₹250 can take the contract higher to ₹255. Key support is at ₹230 and ₹225.

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

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