Comments
The continuous contract of zinc on the Multi Commodity Exchange, which has been witnessing considerable amount of volatility since the beginning of 2021, has managed to stay positive as the year-to-date gain so far is a nearly eight per cent. Although the contract saw a steep fall during the final week of February and the first week of March, it reversed the trend upwards after a brief period of consolidation last month.
The contract started to appreciate in early April from about ₹218 and as a result it broke out of the important level of ₹233 on Monday. So, in addition to a fresh breakout, the continuous contract has also formed a higher high, opening the door for further gain. Substantiating the bullish outlook, the daily relative strength index is showing a fresh uptick and the moving average convergence divergence indicator on the daily chart retains the upward trajectory. Moreover, the breakout volume looks good and the average directional index shows that the bulls have clear advantage over the bears.
Traders can be bullish and can consider initiating fresh long positions. But considering the time to expiry, rather than going long in the nearest expiry i.e., April, one can buy May futures of MCX zinc. While the stop-loss can be placed at ₹225, the potential target can be ₹240. A breach of this level can lift the contract to ₹245.
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.