Jeera prices have been surging over the last few weeks and are on a strong footing. The Jeera futures contract, traded on the National Commodity and Derivatives Exchange (NCDEX), has surged about 19 per cent over the last one month, from ₹18,365 per quintal on November 10 to the current level of ₹21,795.
Strong export demand and restricted supply in the spot market have pushed prices sharply higher over the last one month. Though the prices have been consolidating at higher levels over the last couple of weeks, there is room for the prices to rise further before a correction.
OutlookThe NCDEX-Jeera futures contract has been facing strong resistance at ₹22,000 at the moment. For the last couple of weeks, the contract has not gained enough strength to breach this psychological hurdle. As long as the contract trades below this resistance, a dip to ₹21,000 or ₹20,800 cannot be ruled out in the near-term. However, further fall below ₹20,800 looks less probable. As such, a range-bound move between ₹20,800 and ₹22,000 can be seen for some time. An eventual break and decisive close above ₹22,000 will boost the momentum. Such a break can take the contract higher to ₹23,300 in the coming weeks.
A high-risk appetite trader with a medium-term perspective can go long on dips at ₹21,350. Stop-loss can be placed at ₹20,700 for a target of ₹22,500. Revise the stop-loss higher to ₹21,550 as soon as the contract moves up to ₹21,950.
The contract will come under pressure only if it drops decisively below ₹20,800. Such a fall will increase the likelihood of the contract slipping to ₹20,300 or even lower.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading
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