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The December futures contract of zinc on the Multi Commodity Exchange (MCX) has been in an uptrend since early October. The price rose from about ₹180 and registered a high of ₹222.7 on Monday.
However, the contract witnessed a minor correction where it depreciated to ₹215. Since this is a considerable support, the correction was arrested and the contract has been hovering around this level for the past few trading sessions. Nevertheless, the major trend is bullish and as long as price stays above ₹200, the upward bias will be retained. Also, the price lies well above the 21-day moving average (DMA) – at ₹210 – indicating a bullish bias. Following the price moderation, the daily relative strength index slipped a little. But is remains in the bullish territory and there are no signs of trend reversal. Similarly, the moving average convergence divergence indicator on the daily chart is charting an upward trajectory and lies in the bullish zone.
Considering the above factors, traders can buy the contract with stop-loss at ₹210 with a potential target of ₹230.
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