Portfolio

MCX-Zinc maintains a bullish bias

Akhil Nallamuthu | Updated on October 24, 2019

The price of October futures contract of MCX-Zinc was trading sideways between ₹184 and ₹186.3 recently. The contract has also been trading above the 21-DMA and is inching up above the 50-DMA too, suggesting bullishness; it has also formed higher base. A bullish divergence in the daily relative strength index and the upward pointing moving average convergence divergence indicator adds to the bullish bias.

On the upside, the contract will face resistance at ₹191. A close above that level on daily basis will confirm the breakout and the medium-term trend could become bullish. This might take the contract price to the psychological level of ₹200. Alternatively, a decline from current level will find support at ₹184, below which the price might slide to ₹180.

On global front, the bull run, which started last week in the three-month rolling forward contract of zinc on LME, continues. Trading at $2,470, it faces a resistance ahead in the band between $2,483 and $2,500. Beyond that, it may rise to $2,574. But a decline could drag it to $2,400.

MCX-Zinc price is flat and LME-Zinc is facing a resistance at current level. Hence, any price correction can be used as a buying opportunity. Traders are advised to buy at ₹184 with a stop-loss at ₹179. Maintain a strict stop-loss as the price might face increased downward pressure below ₹180.

Published on October 24, 2019

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