Commodities

MCX Lead stuck in sideways range

Gurumurthy K BL Research Bureau | Updated on January 09, 2018

Inability to break above ₹168 and a pull-back move will continue to keep the contract inside the sideways range for some time.



The Lead futures contract on the Multi Commodity Exchange (MCX) has been stuck inside a sideways range over the last several weeks.

The contract has been range-bound between ₹155 and ₹168 per kg for about two months.

Within this range, the contract made a low of ₹155.65 on Friday last week and has bounced sharply from there.

It is currently trading at ₹161/kg.

The sideways range remains intact. As long as the contract trades above ₹159, there is a strong likelihood of it moving higher to test ₹168 — the upper end of the range in the coming days.

Whether the contract breaks above ₹168 or not will decide the next move. Inability to break above ₹168 and a pull-back move will continue to keep the contract inside the sideways range for some time. In such a scenario, a fall to ₹160 and ₹155 is possible again.

But, if it manages to break above ₹168 decisively, it can gain fresh momentum.

Such a break can take the contract higher to ₹171 initially.

Further break above ₹171 will increase the likelihood of the upmove extending to ₹175.

However, the outlook for the contract will turn negative if it declines below ₹155.

Such a break can drag the contract lower to ₹150.

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

Published on December 14, 2017

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