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The short-term view for copper futures traded on the Multi Commodity Exchange (MCX) has turned negative.
The contract recorded a high of ₹398.8 on March 26 and reversed sharply from there.
It is currently trading near ₹378. Key resistances are now poised at ₹383 and ₹386.
As long as the contract trades below these hurdles, there is a strong likelihood of it to extend its fall to ₹367 in the coming week.
The support at ₹375 – the 21-day moving average level, is unlikely to hold, given the strong downward momentum.
Traders with a short-term perspective can initiate fresh short positions.
Stop-loss can be kept at ₹384 for the target of ₹368.
Intermediate rallies to ₹383 can be used to accumulate more short positions.
The sharp fall witnessed last week, is technically very important.
The level of ₹398.8 from where the contract reversed lower is a key long-term trendline resistance level.
It needs to be seen if this is the beginning of a fresh leg of down move of the long-term downtrend.
The price action in the coming weeks will be crucial to ascertain the next leg of movement in the contract.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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