The Lead futures contract on the Multi Commodity Exchange (MCX) has surged breaking above the key resistance level of ₹150 per kg as expected in the past week. The contract made a high of ₹153.9 on Wednesday and fell sharply reversing from there. However, the support in the ₹150-₹149 region has halted this fall and the contract has bounced back once again on Thursday. It is currently trading at₹151.75 per kg. There is an inverted head and shoulders bullish pattern formed on the chart. The neck-line of this pattern is at ₹149 that has become a key support. As long as the contract trades above ₹149, the outlook will remain bullish. Resistance is at ₹154 which is likely to be tested in the near term. A strong break above this hurdle can take the contract higher to ₹156 initially. Further break above₹156 will increase the likelihood of the contract extending its rally to ₹160 and ₹162 thereafter.
Short-term traders can go long on dips at ₹150. Keep the stop-loss at ₹148 for the target of ₹154. Revise the stop-loss higher to ₹151 as soon as the contract moves up to ₹152.5.
The near-term view will turn negative only if the contract declines below ₹149 decisively. The next target is ₹147. Further strong fall below ₹147 will increase the possibility of the down move extending to ₹145 or even ₹143.
Note: The recommendations are based on technical analysis and there is a risk of loss in trading
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.