Natural gas futures (May contract) on the Multi Commodity Exchange (MCX) has been on an upswing over the past few sessions. The chart hints at more rally, so participants can remain on the long side of the trade.

The contract closed above the resistance at ₹178 last Friday. Currently hovering around ₹181, it is expected to appreciate towards the ₹197-200 price band in the near term. But it could retest ₹178 before rising again.

That said, if natural gas futures break below the support at ₹178, the outlook may turn weak, with the contract dropping to ₹170 or even ₹160. However, as it stands, the contract displays bullish bias.

Trade strategy

Last week, we recommended buying natural gas futures (May series) at ₹175. Retain this trade but raise the stop-loss to the entry price — that is, ₹175 — so that the position is protected. Going ahead, tighten the stop-loss further to ₹180 when the price touches ₹190. Book profits at ₹196.

Traders can also consider fresh buys with a stop-loss at ₹175. After initiating, follow the above modifications when the contract rallies.