Commodity Calls

Buy crude oil, peg stop-loss at ₹5,440

Akhil Nallamuthu BL Research Bureau | Updated on October 07, 2021

The price of crude oil, which has been on a rise since the beginning of the year, saw a considerable drop in July and August. The continuous futures contract of crude oil on the Multi Commodity Exchange (MCX), after hitting a high of ₹5,733 in early July, dropped to ₹4,634 towards the end of August. But since ₹4,570 and ₹4,900 being a demand zone, the decline was restricted and it started to recover.

Despite the contract witnessing a fall over the past couple of sessions, it continues to remain above ₹5,700 and the price action exhibits bullish inclination. Considering the price action over the past couple of weeks, the price band of ₹5,500 and ₹5,650 will provide a solid base for the contract.

From the current level, the contract is likely to cross over ₹6,000-mark in the short-term and potentially touch ₹6,215 over the next two months. So, traders can buy crude oil futures with stop-loss at ₹5,440 and look for targets at ₹6,000 and ₹6,215. Shift the stop-loss to ₹5,650 if the contract decisively breaches ₹6,000.

Published on October 07, 2021

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