The Lead futures contract on the Multi Commodity Exchange (MCX) has been volatile over the last week.
The contract rose to a high of ₹151.6 a kg on Monday and reversed sharply to a low of ₹145.3 on Wednesday.
However, the contract price managed to move higher from this low and is currently trading at ₹147.8.
Technically this bounce is significant as it has happened from around the 200-day moving average as well as a trendline support.
As long as the contract trades above ₹145, the possibility of it falling further is less. While above ₹145, a rise to ₹150 and ₹152 is possible in the near-term.
The 61.8 per cent Fibonacci retracement resistance is at ₹152.35. Inability to break above this hurdle can keep the contract range-bound between ₹145 and ₹152 for some time.
But if the contract manages to rise above ₹152.35 decisively, it can gain fresh momentum.
Such a break would take the contract higher to ₹155 and ₹156 initially. A further break above ₹156 will then pave the way for the next targets of ₹160 and ₹165.
The contract will come under pressure only if it declines below ₹145. A break below ₹145 can take it to ₹144 initially.
A further break below ₹144 can drag the MCX-Lead futures contract to ₹140.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading