Commodities

Outlook turns bullish for MCX-Zinc

Akhil Nallamuthu BL Research Bureau | Updated on October 23, 2020 Published on October 22, 2020

The October futures of zinc in Multi Commodity Exchange (MCX), which has been rallying since July, face a corrective decline in September.

The price dropped by nearly 10 per cent from about ₹200 to mark a low of ₹181.2 in the first week of October.

The 50 per cent Fibonacci retracement level of the prior rally was at ₹181 providing support.

The bulls then took charge and the contract resumed its uptrend. Consequently, on Tuesday, the price rose above the crucial resistance level of ₹200, opening the door for further strengthening.

Also, the contract moved past both 21- and 50-day moving averages. So, the outlook has turned bullish and the contract is likely to advance from current level to ₹210.

 

A breakout of this level can take it to ₹218. On the downside, support levels can be spotted at ₹200 and ₹193.

Corroborating the bullish inclination, the relative strength index and the moving average convergence divergence indicators are in their respective positive territories. Hence, traders can buy the contract in dips with stop-loss at ₹193.

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Published on October 22, 2020
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