The natural gas futures contract traded on the Multi Commodity Exchange (MCX) extended its fall last week as well.

The contract has been in a strong down-trend and has tumbled over 20 per cent from its high of ₹288.7 per mmBtu recorded on June 18.

The down-trend is expected to extend in the coming days as well. Though there is some support near the current level of ₹227, since the momentum of the fall is strong, the probability is less for an upward reversal from this support level.

So traders can go short at the current level. Stop-loss can be placed little wide at ₹242 for the target of ₹200. If the contract bounces from current levels, it will be just a corrective rally. Such rallies can be used as a good opportunity to accumulate more short positions at ₹235 and ₹240 levels.

MCX-crude oil: The MCX-crude oil futures contract has declined slightly after recording a high of ₹6,273 a barrel on Monday. Though the contract can fall further in the coming days, the 200-day moving average support is near ₹6,103 which can arrest the fall. A reversal from here can take the contract higher to its resistance at ₹6,280. The targets on a breach of this level will be ₹6,400 and ₹6,500.

The broader ₹5,950-6,550 sideways range remains intact. So, traders who took long positions last week can continue to hold on to their positions with the same stop-loss of ₹5,940 and a target of ₹6,400. Dips to ₹6,103 can be considered for accumulating more long positions.

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

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