Downtrend intensifies in MCX Lead

Gurumurthy K | Updated on March 08, 2018 Published on March 08, 2018

The Lead futures contract on the Multi Commodity Exchange (MCX) is under pressure. The contract has tumbled about 6 per cent in the past week from ₹164 per kg to the current levels of ₹154.

With this sharp fall in the past week, the downtrend in the contract has intensified. The indicators on the charts are also strengthens the bearish view. The 21-day moving average has crossed below the 55-day moving average — a bearish signal indicating that the upside could be limited.

A dip to test the immediate support at ₹152 is likely. However, an intermediate bounce from ₹152 towards ₹155 or higher levels cannot be ruled out. But strong resistance is in the ₹157-160 region which is likely to cap the upside in the short-term.

Further rally breaking above ₹160 is unlikely. The contract may remain range-bound between ₹152 and ₹160 for some time. However, the bias will continue to remain bearish.

An eventual break below ₹152 will see the down move extending towards ₹150 and ₹148. Traders can make use of rallies to go short at ₹157 and ₹159.

Stop-loss can be placed at ₹162 for the target of ₹148. Revise the stop-loss lower to ₹155 as soon as the contract moves down to ₹151.

The downside pressure will ease only if the contract manages to rise past ₹160 decisively. Such a break will negate the bearish outlook.

It will then increase the possibility of the contract rallying towards ₹165 and ₹170 levels again.

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

Published on March 08, 2018

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!


Support Quality Journalism
This article is closed for comments.
Please Email the Editor


This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.