Commodity Calls

Pressure mounts on MCX-Lead

Gurumurthy K BL Research Bureau | Updated on July 12, 2018 Published on July 12, 2018

The Lead futures contract on the Multi Commodity Exchange (MCX) has plummeted about 10 per cent over the last one week. It is currently trading at ₹147 per kg.

The sharp fall in the past week has dragged the contract decisively below the key ₹162-₹159 support region which was limiting the downside. Additionally, the fall on Thursday has taken the contract below a crucial long-term support level of ₹150. Both a trend-line as well as the 100-week moving average are poised around ₹150. Whether the contract manages to bounce-back above ₹150 or not will determine the next trend. As such the price action in the coming days will need a close watch.

If the contract manages to rise past ₹150, the downside pressure may ease. In such a scenario, a relief rally to ₹158 or ₹160 is possible in the short term. Also, the contract may then remain in a sideways range between ₹150 and ₹160 for some time.

But if the MCX-Lead futures contract remains below ₹150 in the coming sessions, it will continue to trade under pressure. In that case, there is a strong likelihood of the contract extending its fall to ₹140 in the coming days.

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

Read the rest of this article by Signing up for Portfolio.It's completely free!

What You'll Get

This article is closed for comments.
Please Email the Editor