The Lead futures contract on the Multi Commodity Exchange (MCX) is inching higher but at a slower pace. The contract is not gaining strength to breach above ₹150 per kg decisively. It is currently trading at ₹149 a kg.

The 61.8 per cent Fibonacci retracement resistance is poised at ₹152.35. The contract needs to surpass this hurdle decisively to gain fresh momentum. Inability to break above the Fibonacci resistance at ₹152.35 can keep the contract range bound between ₹145 and ₹152 for some time.

However, the bias is bullish on the chart. The 21-day moving average has crossed over the 100-day moving average. It is now on the verge of crossing over the 200-day moving average. This is a positive signal suggesting that the downside in the contract could be limited in the near term. As such a fall below ₹145 is less likely at the momentum. Dips to this support may find fresh buyers coming into the market.

An eventual break above ₹152 can boost the momentum. Such a break can take the contract higher to ₹155 initially. Further break above ₹155 will increase the likelihood of the contract extending its upmove to ₹160 or even ₹163 thereafter.

Short-term traders can wait for dips and go long at ₹146. Stop-loss can be placed at ₹143 for the target of ₹155. Revise the stop-loss higher to ₹148 as soon as the contract moves up to ₹150.

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

Related Topics
comment COMMENT NOW