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Gaining bullish momentum, the MCX-Natural Gas futures contract has jumped 3 per cent on Wednesday.
Extending this rally, the contract has surpassed the key immediate resistance at ₹215 on Thursday by advancing another 4 per cent with above average volume, trading at around ₹220. This rally has strengthened the short term uptrend that has been in place from the base level of ₹165 recorded in late December 2020. While trending up, the contract had decisively surpassed the key resistance as well as 50-day moving average in early February.
The medium-term trend has been up for the contract since it took support at ₹120 in July 2020. The contract trades well above the 21- and 50-day moving averages.
Moreover, the daily as well as the weekly price rate of change indicators are hovering in the positive territory implying buying interest. The short-term outlook is bullish.
Traders can buy the contract with a stop-loss at ₹205. A clear rally beyond ₹220 can take the contract higher to ₹225 and then to ₹230 levels in the coming weeks.
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