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Investors with a short-term perceptive can consider selling the stock of Multi Commodity Exchange of India (MCX) at current levels. Since encountering a key resistance at ₹1,400 in December 2016, the stock has been in a long-term downtrend. The stock failed to break above a vital resistance at ₹1,150 in October 2017 and the stock resumed its downtrend. Since then, it has been in a medium-term downtrend.
The sharp 5 per cent fall on Wednesday breaking below the key support level of ₹900 has strengthened the downtrend. Moreover, the stock has plunged 9.6 per cent so far this week, witnessing selling pressure. .
MCX trades well below its 21- and 50-day moving averages. The daily and weekly relative strength indices are featuring in the bearish zone. Likewise, the daily as well as weekly price rate of change indicators are hovering in the negative territory implying selling interest.
The short-term outlook is bearish for the stock. It can extend the fall and reach the price targets of ₹820 and ₹800. Traders can sell the stock with a stop-loss at ₹868.
(Note: The recommendations are based on technical analysis. There is a risk of loss in trading.)
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