MCX-Zinc continues to trend upwards

Yoganand D BL Research Bureau | Updated on August 06, 2020

The August futures contract of zinc on the MCX, last week breached a key resistance at ₹178. Recently, the contract had surpassed another key barrier at ₹187. It is currently hovering at ₹191.4 levels. It trades well above the 50- and 200-day moving averages. The daily as well as the weekly RSI are featuring in the bullish zone. Besides, the daily and the weekly price rate of change indicators are hovering in the positive terrain implying buying interest. The contract now faces an immediate resistance at ₹195 that could be surpassed effortlessly. However, it has a significant long-term resistance at ₹200 which could act a vital barrier. An emphatic break above ₹200 can push the contract northwards to ₹205 and then to ₹210. Conversely, if the contract falls below ₹187 it can experience selling and pull the contract down to ₹178-₹180 band. Next support is at ₹170. On the global front, the three-month rolling forward contract of zinc on the LME has been charting higher since early July. It had breached a key hurdle at $2,300 recently.

Trade strategy: Traders can buy MCX-Zinc with a stop-loss at ₹183 and consider booking profit at ₹200. Desist taking fresh long positions if the it decisively falls below ₹180.

Published on August 06, 2020

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