Zinc futures on the Multi Commodity Exchange (MCX) began an upswing in mid-August after taking support at ₹210. Last week, after marking a high of ₹227.6, the September contract has now moderated to ₹221. Therefore, the resistance at ₹225 remains true and so does the range of ₹210-225.
On the back of the barrier at ₹225, we might witness a fall in zinc futures in the coming sessions. The downswing might drag the contract to ₹210 from where there might be a rebound.
In case the contract regains positive momentum and rallies past the hurdle at ₹225, it can quickly rally to ₹250. On the other hand, if the support at ₹210 is breached, the bears might pull the contract down to ₹180.
Over the last couple of weeks, we suggested shorting zinc futures at an average price of ₹223. Stop-loss was recommended at ₹230. Retain this trade.
Going forward, when the contract falls to ₹215, tighten the stop-loss to ₹220. Book profits at ₹210.