The copper continuous futures contract on the Multi Commodity Exchange of India (MCX) had registered a 52-week high at ₹812.6 on May 10.

Since then, the contract has been in a near-tern corrective downtrend and it has declined some nine per cent from the peak. Recently, the contract has breached a key support at ₹760 as well as the 21-day moving average. The contract has recorded an intra-day low at ₹733 and has started to recover from the low. It is trading at around ₹742.

The contract has a key support ahead in the band between ₹725 and ₹730 that could provide base in the coming weeks.

An upward reversal from this support zone can keep the contract sideways for a while before taking a clear short-term direction.

An emphatic downward break of ₹725 will strengthen the downtrend that commenced from the 52-week high and pull the contract down to ₹712 and then to ₹700 over the short term.

Key supports thereafter are placed at ₹686, ₹673 and ₹660 levels. The medium-term uptrend that started from the February low of ₹585 will be in place as long as the contract trades above the significant support level of ₹660 levels.

The long-term uptrend has been intact since copper continuous futures contract took support at ₹335/kg in March 2020. This uptrend will stay in placed as long as the commodity price trades above ₹520 levels.

Traders with a short-term view should tread with caution.

A conclusive break above ₹760 will alter the corrective decline and take the contract northwards to ₹774 and then to ₹787 levels. Next resistance is at ₹800.

Related Topics
comment COMMENT NOW