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The continuous contract of nickel on the Multi Commodity Exchange of India (MCX) found support at around ₹1,150 in this March after a sharp fall from the February high of ₹1,457 levels. The contract subsequently began to trend up in late March and has been in a medium-term uptrend since then.
The contract had met with a key resistance at ₹1,345 levels in early May and has moved sideways with an upward bias. On June 24, the contract jumped 2.7 per cent with good volume breaching the key resistance at ₹1,345 levels. Now, this level will act as a significant base for the contract. Also, it trades well above the 21- and 50-day moving averages.
On Monday, the contract fell 1.1 per cent but trades above the key base level of ₹1,345 levels. The daily relative strength index features in the bullish zone and the weekly RSI is on the brink of entering the bullish zone from the neutral region.
Traders with a short-term view can buy the contract on dips with a stop-loss at ₹1,325. A strong rally above ₹1,400 levels strengthen the uptrend and take it higher to ₹1,425 and then to ₹1,450 levels over the short term. Key supports below ₹1,300 are placed at ₹1,270 and ₹1,225 levels.
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