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The lead futures contract on the Multi Commodity Exchange (MCX) has been stuck in a narrow range between ₹150 and ₹155 a kg in the past week.
A breakout on either side of ₹150 or ₹155 will decide the next leg of movement for the contract.
A strong break below ₹150 can take the contract lower to ₹148, the 100-day moving average support, initially. If the contract manages to bounce from ₹148, a rise to ₹152 or even ₹155 is possible.
But a break below ₹148 can drag the MCX lead futures contract lower to ₹146 or ₹145.5 thereafter. On the other hand, if the contract manages to sustain above ₹150, the possibility will remain high for the contract to break above ₹155.
Such a break can take it to ₹157 — the 21-week moving average resistance. Failure to break above this hurdle can trigger a pull-back to ₹150 once again.
Such a reversal may keep the contract under pressure. A strong break above ₹157 is needed to ease the downside pressure. Such a break will open the doors for a fresh rally to revisit ₹163 and ₹165 levels.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading
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