The price of aluminium was on a steady uptrend since March 2020.

The price appreciation continued in 2021 as well and consequently, the continuous futures contract of the metal on the Multi Commodity Exchange (MCX) rallied.

It made a fresh high of ₹259.3 in mid-October this year.

However, the contract faced considerable sell-off at those levels and reversed the trend downwards.

After falling to the key level of ₹200 in early November, the contract stopped declining. Since then, it has been largely consolidating within ₹204 and ₹217.

Notably, despite the fall, the major trend remains bullish, and it stay so until the contract trades above the price band of ₹200-204.

So, the contract may rebound from these levels.

However, currently trading around ₹210, the aluminium futures face a barrier at ₹217 and thus, the likelihood of a consolidation between ₹204 and ₹217 might continue for a while.

Above ₹217, the nearest resistance levels can be seen at ₹225 and ₹235.

But the resistance at ₹225 may not be able to stop the uptrend and the contract is likely to rally to ₹235.

Traders can stay on the side-lines and initiate fresh long positions on the aluminium futures on the MCX when it decisively breaches ₹217. Stop-loss can be placed at ₹210 initially.

When the contract moves above ₹225, revise the stop-loss up to ₹215. Since there can be a correction after the contract hitting ₹235, consider exiting the long positions at this level.

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