Commodities

MCX-Lead likely to decline further

Akhil Nallamuthu BL Research Bureau | Updated on October 05, 2020 Published on October 05, 2020

The October futures contract of lead in the Multi Commodity Exchange (MCX) has been on a decline since the last week of August. The price fell from about ₹158 to the current level of about ₹142 and it is now trading below the 21-day moving average (DMA). Also, the 21-DMA has crossed below the 50-DMA — a bearish indication.

Substantiating the negative bias, the contract has been forming lower lows; the daily relative strength index is on a decline and has slipped below the midpoint level of 50. Moreover, the moving average convergence-divergence indicator in the daily chart is charting a downward trajectory and has moved deeper into the bearish zone. Given the above reasons, the contract will most likely fall further.

The nearest support from the current level is ₹138 with the subsequent support at ₹135. But if the contract reverses from here and rallies, the immediate hurlde it will face can be ₹145. Beyond that level, the contract can rise to ₹148.

Now that the trend is bearish, traders can sell on rallies with stop-loss at ₹148.

Note: The recommendations are based on technical analysis.

There is a risk of loss in trading

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

Published on October 05, 2020
This article is closed for comments.
Please Email the Editor