Commodity Calls

Key resistance ahead for MCX-lead

Gurumurthy K BL Research Bureau | Updated on August 30, 2018 Published on August 30, 2018

The lead futures contract on the Multi Commodity Exchange (MCX) has reversed sharply higher over the last couple of weeks. The contract made a low of ₹137.25/kg on August 20 and has moved up sharply, surging over 7 per cent. It currently trades at ₹147/kg.

The strong rally has taken the contract well above the key ₹144-₹145 resistance region. Immediate resistance is in the ₹148-₹149 region. A break above ₹149 will ease the downside pressure and can take the contract higher to ₹151 or ₹152 in the near term. Further break above ₹152 will then boost the momentum and increase the likelihood of the contract rallying to ₹155 or even ₹157 over the short term.

On the other hand, if the MCX-lead futures contract fails to breach the immediate resistance region, it can witness a pull-back move. The contract can then decline to test the 21-day moving average support at ₹144. A range-bound move between ₹144 and ₹149 is possible for some time. The contract will come under pressure only if it breaks below ₹144 decisively. Such a break will then drag the contract lower to revisit ₹140 or even ₹137.

Note: The recommendations are based on technical analysis and there is a risk of loss in trading.

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