Coriander prices have been under pressure since February.

The coriander futures contract traded on the National Commodity & Derivatives Exchange (NCDEX) made a high near ₹6,000 a quintal in late January and has reversed sharply lower from there.

The prices have tumbled over 15 per cent and are currently at ₹5,081/quintal.

Outlook: The price action on the chart suggests that the long-term downtrend is intact for the contract. The pull-back from around ₹6,000 has happened from a 50 per cent Fibonacci retracement level which is a key resistance level.

Also, the 100-day moving average at around ₹5,500 has capped the upside in the contract earlier this month. This leaves the short-term outlook bearish.

The possibility is high that the contract can fall to ₹4,900 in the coming days.

Further break below ₹4,900 will then increase the likelihood of the contract tumbling towards ₹4,500 or even to ₹4,350 over the medium-term.

The downside pressure will ease only if the contract manages to breach ₹5,500 decisively.

Such a break will increase the possibility of the contract rallying to ₹6,000 or even to ₹6,200.

Trading strategy: Traders with a medium-term perspective can go short at current levels and also on rallies at ₹5,150. Stop-loss can be placed at ₹5,450 for the target of ₹4,500. Revise the stop-loss lower to ₹5,025 as soon as the contract moves down to ₹4,915.

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

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