The Nickel futures contract on the Multi Commodity Exchange (MCX) has surged breaking above the resistance at ₹640 a kg as expected in the past week. The contract made a high of ₹660.8 on Monday and has been hovering at this high since then. It is currently trading at ₹653 . Key resistances are poised at ₹657 – the 38.2 per cent Fibonacci retracement level and ₹665 – the 200-day moving average. There is a strong likelihood of the upmove that has been in place over the last couple of months, coming to a halt in the coming days. Though a test of this resistance at ₹665 cannot be ruled out, the upside is expected to be capped at ₹665 in the near term. A corrective fall in the coming days looks more evident. Such a pull-back move can drag the contract lower to ₹640 or even ₹630 thereafter. An eventual upward reversal from ₹640 or ₹630 will take the contract higher to ₹660 and ₹665 levels once again.
Short-term traders with a high-risk appetite can go short on a reversal from ₹665. Stop-loss can be kept at ₹669 for the target of ₹650. Revise the stop-loss lower to ₹660 as soon as the contract moves down to ₹657.
The contract will need to break above ₹665 decisively to gain fresh momentum. Such a break will take it higher to ₹670 initially. Further break above ₹670 will increase the possibility of the upmove extending to ₹690 and ₹700 levels.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.