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The downtrend in the Lead futures contract traded on the Multi Commodity Exchange (MCX) remains intact. The bounce-back from Monday’s low of ₹135.1 per kg failed to get strong follow-up buying.
The contact has reversed sharply lower once again after recording a high of ₹142.9 on Wednesday. It is currently trading at ₹136.2. A key support is at ₹135 which is the 61.8 per cent Fibonacci retracement level.
A strong break below ₹135 may drag the contract lower to ₹130 or ₹128 in the coming days. Short-term traders with a big risk appetite can go short on a break below ₹135. Stop-loss can be placed at ₹138 for the target of ₹130. Revise the stop-loss lower to ₹134 as soon as the contract declines to ₹132.5.
The region between ₹143 and ₹145 is a key resistance zone for the contract. The downside pressure will ease only on a decisive break above ₹145. Such a break will increase the likelihood of the contract rising to ₹150 or ₹151 thereafter.
The 21-day moving average is at ₹151 and may cap the upside in the short term. The outlook would turn positive only if it manages to breach ₹155 decisively.
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