Coriander prices have been recovering over the last couple of months. The Coriander futures contract on the National Commodity & Derivatives Exchange (NCDEX) saw a low of ₹4,186 per quintal and has reversed sharply higher.

The contract has surged over 25 per cent from the low and touched a high of ₹5,240 last week. It has come-off from the highs and is currently trading at ₹4,946 per quintal.

Outlook

Though the contract has come off from the high of ₹5,240, but the overall uptrend that had begun from June remains intact. A strong support is in the ₹4,850-₹4,800 region. Though the current downmove can extend to test this support zone, a break below ₹4,800 looks less probable. Also there is an inverted head and shoulders reversal pattern visible on the chart. This is a bullish reversal pattern. The neck-line support of this pattern is also at around ₹4,800 which makes this level a very strong support.

An upward reversal from ₹4,800 can take the contract higher to ₹5,300 over the short term. A further break above ₹5,300 will boost the momentum. Such a break will increase the likelihood of the contract targeting ₹5,500 and ₹5,700 over the medium term.

The bullish outlook will get negated only if the contract declines below ₹4,800. Such a break can drag the contract lower to ₹4,600 or even lower.

Traders with a medium-term perspective can go long at current levels and also accumulate on dips at ₹4,875 and ₹4,825. A stop-loss can be placed at ₹4,700 for the target of ₹5,450. Revise the stop-loss higher to ₹5,150 as soon as the contract moves up to ₹5,225.

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

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