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BL Research Bureau
Although the lead price went up in 2021 and ended the year with a gain, the uptrend lost steam towards the end of September. Therefore, the continuous lead contract on the Multi Commodity Exchange (MCX) has been fluctuating within the broad range of ₹180–₹196. So, even though the contract posted a gain last week, it lies within the range. Moreover, currently trading at around ₹189, the risk-reward ratio suggests that range trading strategy might not be a good tactic now.
The 21- and 50-day moving averages (DMAs) are flat, indicating a lack of trend. And, indicators like the relative strength index (RSI) and the moving average convergence divergence (MACD) are hovering in the neutral region. Therefore, participants are recommended to stay away and wait for the breach of either ₹180 or ₹196. Traders can initiate fresh trades along the direction of the break.
If the contract breaks out of ₹196, the lead futures can ease past ₹200-mark and touch ₹210. Above that level, it can rally to ₹220. Since the over trend is up, the contract can witness a quick rally. On the other hand, if the contract slips below ₹180, the near-term trend can turn bearish. The nearest support below ₹180 can be seen at ₹168, below which ₹158 can offer support.
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