MCX Lead bounces from crucial support levels

Gurumurthy K BL Research Bureau | Updated on February 15, 2018

The Lead futures contract on the Multi Commodity Exchange (MCX) has made a smart recovery in the past week.

With this rally, the threat of a sharp fall after breaking below the crucial support level of ₹163 per kg in the week earlier has eased.

The contract made a low of ₹160.2 on Thursday last week and has reversed higher from there. It is currently trading at ₹166.

The upward reversal in the past week suggests that the contract lack fresh sellers to drag it below ₹160. Moreover, this also indicates the emergence of strong buyers at lower levels.

As long as the contract trades above the ₹163-162 support region, the near-term view will be bullish.

A cup and handle pattern is on the making on the charts. This leaves the possibility high of the contract rallying towards ₹170 and ₹172 again.

An eventual break above ₹172 will then take the contract further higher to ₹174 and ₹175.

Short-term traders with a high-risk appetite can go long on dips at ₹165 and ₹164. Keep the stop-loss at ₹160 for the target of ₹172.

Revise the stop-loss higher to ₹167 as soon as the contract moves up to ₹169.

The outlook will turn negative only if the contract makes a decisive close below ₹163. In such a scenario, the contract can fall sharply to ₹155 on the back of profit booking.

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

Published on February 15, 2018

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor


This article is closed for comments.
Please Email the Editor