Commodity Calls

Outlook bullish for MCX-Zinc

Gurumurthy K BL Research Bureau | Updated on January 11, 2018 Published on July 25, 2017
Zinc prices have fallen 30 per cent since May to five-year lows.


The Zinc futures contract on the Multi Commodity Exchange (MCX) has reversed higher, as expected, from the support at ₹175 a kg. The contract declined below a key support at ₹180 last week.

However, the contract has managed to reverse higher again after touching a low of ₹174.7 on Thursday. This leaves the overall bullish outlook intact.

The contract is currently trading at ₹182.6. Immediate resistance is at ₹183. Inability to break above this hurdle can trigger a pull-back to ₹180 or ₹177 once again.

In such a scenario, the contract may remain range bound between ₹175 and ₹183 for some time.

But if the contract manages to break above ₹183 decisively, it can rise to ₹185 initially. A further break above ₹185 will increase the likelihood of the contract extending its rally to ₹190 and to ₹195 thereafter.

Traders who have taken long positions on dips at ₹178 can hold their positions. Retain the stop-loss at ₹171 and revise it to ₹180 as soon as the contract moves up to ₹186.

The contract will come under pressure only if it breaks below the key 200-day moving average support level of ₹175 decisively. The next targets will be ₹173 and ₹170. But such a strong fall looks unlikely at the moment.

Note: The recommendations are based on technical analysis and there is a risk of loss in trading

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

Published on July 25, 2017
This article is closed for comments.
Please Email the Editor