Gurumurthy K It was a volatile week for the Lead futures contract on the MCX. The contract surged breaking above the 200-day moving average resistance and made a high of ₹153.5 on Monday. However, the contract has come-off sharply giving back almost all the gain and is currently trading at ₹149 per kg.
The key resistance in the ₹151-152 region is holding well as of now. As long as the contract trades below this resistance zone, there is a strong likelihood of it falling towards ₹147 in the near term. A break below ₹147 will then increase the possibility of the downmove extending towards ₹145 or ₹143 thereafter.
The contract will have to rise past ₹152 decisively to bring back the positive sentiment. In such a scenario, the downside pressure will ease, and the contract can then target ₹155 and ₹157 levels.
Traders can stay out of the market for sometime.
Global trend
The Lead (three-month forward) contract on the LME has come-off after making a high of $2,136.5 per tonne on Tuesday. The 200-DMA at $2,125 has capped the upside and has triggered the fall. The contract is currently trading at $2,090 per tonne.
Immediate support is at $2,070 which can be tested in the near term. If the contract manages to bounce from this support, an upmove to revisit $2,100 and $2,125 is possible again. The contract will gain fresh momentum if it breaks above $2,125 decisively. Such a break will then increase the likelihood of the contract rallying towards $2,170 and $2,200 thereafter.
On the other hand, the LME-Lead contract will come under more pressure if it breaks below the immediate support level of $2,070. In such a scenario, a fall to $2,025 or even $2,000 cannot be ruled out.
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.