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Aluminium futures on the Multi Commodity Exchange (MCX) have been declining since the beginning of February. It had fallen off the resistance around ₹230.
Towards the end of last week, the March contract found support at the price band of ₹203-205. It has slightly rebounded on the back of it and is currently hovering around ₹207.
Since the support band of ₹203-205 is a substantial one, we expect the aluminium futures to rebound, at least for the short-term. On the upside, the nearest resistance levels are at ₹215 and ₹230.
However, if the contract resumes the downtrend and falls below ₹203, it may find support at ₹192. Subsequent support is at ₹192.
Nevertheless, there are good chances for a short-term bounce on the back of the support band of ₹203-205.
Trade strategy
We suggest participants go long at the current level of ₹207. Add more longs if the price dips to ₹205. Place initial stop-loss at ₹200.
When the contract touches ₹215, modify the stop-loss to ₹210. Book profits at ₹228.
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