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It was a volatile week for the Lead futures contract on the Multi Commodity Exchange (MCX). The contract made high of ₹169.75 per kg on 16, February and has come-off from there. It tumbled to a low of ₹161.65 on Thursday but has managed to bounce back from this low. It is currently trading at ₹164 per kg. The immediate outlook is unclear. The price action in the coming days will need a close watch which would give an indication on the next leg of move. Traders can stay out of the market until a clear trend and a trade signal emerges.
A strong break below ₹160 will increase the downside pressure. Such a break will increase the likelihood of the contract tumbling to ₹155 in the short-term. The level of ₹155 is a key medium-term support. A strong upward reversal from there can take the contract higher towards ₹160 and ₹165 levels again over the medium-term.
On the other hand, if the MCX-Lead futures contract sustains above ₹160 and gains momentum, it can move up to ₹170 or even ₹175 going forward. The region around ₹175 is a key long-term resistance for the contract. A strong break and a decisive weekly close above this hurdle will then pave way for the contract to target to ₹190 or even higher levels over the long-term.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading.
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