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The Nickel futures contract on the Multi Commodity Exchange (MCX) continues to oscillate around the psychological ₹1,000 per kg mark for the second consecutive week. The contract has been stuck in a narrow range between ₹985 and ₹1,025 and is currently trading at ₹993 per kg. The immediate outlook is mixed. However, the bias on the chart remains positive.
Near-term support is at ₹968 – a trendline as well as the 21-day moving average. As long as the contract stays above this support, the outlook will remain bullish. Resistance is in the ₹1,020-₹1,025 region. A strong break above this resistance zone can boost the momentum. Such a break can take the contract higher to ₹1,050 and ₹1,100 levels again.
The short-term outlook will turn negative only if the contract declines below the key support level of ₹968. In such a scenario, the contract can fall to ₹950 initially. Further break below ₹950 will then increase the likelihood of the contract tumbling towards ₹900 thereafter.
Trading strategy
Traders with a medium-term perspective can take fresh long positions at current levels and also accumulate on dips at ₹980 and ₹970. Stop-loss can be placed at ₹940 for the target of ₹1,080. Revise the stop-loss higher to ₹1,015 as soon as the contract moves up to ₹1,035.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading
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