The price of Nickel November futures contract on Multi Commodity Exchange of India, after slipping below the support at ₹1,200, looks to have taken support at ₹1,155. It rallied from that level and is currently trading near a resistance at ₹1,209, which is significant because the price area has coincided by both 21- and 50-DMAs. Since the beginning of September, the contract has been on a gradual decline and as long as price stays below the 50-DMA, downward pressure likely to remain. Though the daily relative strength is flat, the moving average convergence divergence is still in the negative territory indicating a bearish bias.

The commodity may witness selling pressure as it is currently trading near a resistance. So, a decline from current level will pull down the futures price to the previous low of ₹1,155. A break below that level could intensify the sell-off and drag the price to ₹1,100 over the medium term. On the other hand, if the contract breaks above the resistance at ₹1,209, it will face a hurdle at ₹1,240. Above that level, the resistance is at ₹1,265.

In the global market, the price of three-month rolling forward contract of nickel on the LME continues to trade below the key level of $17,000. As long as the price rules below that level, chances of further decline is more. The contract may fall to $16,385, below which the support is at $16,000. Whereas on the upside it will face a resistance at $17,800 and then at $17,000.

The price of MCX-Nickel futures and LME-Nickel, both has gained marginally after breaking down but faces a resistance. Unless it breaks out of the resistance, the commodity can be approached with a bearish bias. Hence, traders can initiate short positions on rallies with a stop-loss at ₹1,270. Adhere to a strict stop-loss as the long-term trend has not completely turned negative.

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