Comments
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.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.