The outlook for the crude oil futures contract traded on the Multi Commodity Exchange (MCX) remains bearish. The contract which is currently trading near ₹5,002/barrel is facing resistance at ₹5,120. The contract is likely to extend its fall in the coming days.

The global WTI crude oil ($80.7/barrel) is also likely to breach the $80 mark. As mentioned in this column last week, a fall to $73.5 in WTI crude oil price in the coming weeks, looks highly probable.

On the domestic front, a strong fall below the psychological ₹5,000 level, could trigger selling pressure in the MCX-crude oil futures contract. Such a fall can drag the contract lower to ₹4,700 or ₹4,600 in the coming trading sessions.

Traders with a short-term perspective can initiate fresh short-position in the contract. Stop-loss can be placed at ₹5,250 for the target of ₹4,700. Intermediate rallies to ₹5,100 and ₹5,200, can be used as an opportunity to accumulate more short positions.

MCX-natural gas: The MCX-natural gas (₹224 per mmBtu) futures contract has declined over 4 per cent in the past week, breaching its key support at ₹234. The bull channel within which the contract was trading since July has been broken. As a result, the outlook has now turned bearish for the MCX-natural gas futures contract. Key resistances are poised at ₹232 and ₹234. As long as the contract trades below these levels, a fall to ₹215 – the 61.8 per cent Fibonacci retracement level – looks likely in the coming days.

Traders with a short-term perspective can take short position at current levels. Stop-loss can be placed at ₹230 for the target of ₹216.

Inability to reverse higher from the support at ₹215, can take contract lower to ₹200.

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

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