Comments
The lead futures on the Multi Commodity Exchange (MCX) saw its price drop in the past two months. After facing resistance at ₹192 in mid-January, the contract started to decline gradually. Nevertheless, after reaching the support at ₹180 a month back, the decline halted and started moving sideways in the recent weeks.
The support at ₹180 is strong and we expect the contract to bounce off from this level. Although there is a minor resistance at ₹186, we anticipate lead futures to surpass this to touch ₹192 in the short-term.
If the contract slips below the support at ₹180, the outlook will change bearish. In such a case, we might see the price swiftly falling to ₹170 – a major support.
Nevertheless, as long as the contract stays above ₹180, traders can take a bullish bias. Also, the risk-reward ratio is favourable for long positions at this juncture.
Trade strategy
Buy lead futures at ₹183 and add more longs if the price dips to ₹181. Place the stop-loss at ₹178 at first. Revise this up to ₹183 when the contract rallies above ₹186.
Further, tighten the stop-loss to ₹186 when the price goes above ₹188. Book profits at ₹192.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.