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The outlook for the Copper futures contract traded on the Multi Commodity Exchange (MCX) is bearish. The bounce from the low of ₹753 last week seems to lack momentum. It is currently trading at ₹753. The contract has struggled to breach ₹780. This leaves the chances high to see a break below ₹750 in the coming days.
Such a break can drag the contract down to ₹715 over the next two-three weeks. Traders with a short-term perspective can go short now. Accumulate shorts on a rise at ₹773. Keep the stop-loss at ₹791.
Trail the stop-loss down to ₹748 as soon as the contract falls to ₹732. Move the stop-loss down to ₹728 as soon as the contract touches ₹721 on the downside. Book profits at ₹717.
Important resistances are at ₹780 and ₹787. A strong rise past ₹787 is necessarily needed to ease the downside pressure and revisit ₹800 levels again. But that looks less probable.
On the charts, there are early signs that the broader uptrend that has been in place since March 2020 has got reversed. This could keep the prices below ₹787 as fresh and strong selling interest can come into the market on any bounce from current levels.
The expected fall to ₹715 mentioned above will strengthen the case of the trend reversal. A sustained break below ₹715 will confirm the same. Chances are high that ₹715 can hold on to its first test and produce a corrective bounce to ₹750-₹780. But the upside is likely to capped and we prefer the MCX Copper contract to fall below ₹715 eventually.
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