Zinc futures saw some moderation in price last week. The nearest expiry i.e., March series lost nearly 1.9 per cent over the past week as it ended at ₹275.45/kg on Friday.
However, the trend has not turned bearish. That said, since the March contract is nearing expiry, we can consider April futures for trading.
The April futures, which made a low of ₹273.75 last week has seen a recovery so far this week. It closed at ₹278.10 on Tuesday.
The price action appears bullish. Zinc futures (April) can rally to ₹293 in the short run.
However, if the contract falls below ₹273, a support, the near-term outlook can become weak. In such a case, it can extend the decline to ₹266 and ₹258.
But as it stands, the uptrend in zinc futures is intact.
Trade strategy
Last week, we recommended buying March zinc futures at an average price of ₹275.50. Since this contract is about to expire, we suggest rolling over the longs.
That is, exit March futures at the prevailing price and go long on April futures at ₹278. Target and stop-loss can be ₹293 and ₹270 respectively.