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Lead futures (continuous contract) on the Multi Commodity Exchange (MCX) have been in a sideways crawl for the past week. The July series has been oscillating within the ₹181-183 range.
Nevertheless, the overall bias remains bearish, and the chances of a decline are high. Although there is a support at ₹180, we expect the contract to fall to ₹175 — a notable base.
The contract has its nearest resistance at ₹183. Subsequent hurdle is at ₹186. Only a breakout of this barrier can confirm a bullish reversal.
Trade strategy
Last week, we advised to initiate fresh short positions at an average price of ₹182.20, with stop-loss at ₹186. Retain these positions.
When the contract sees a daily close below ₹180, tighten the stop-loss to ₹182. When the contract touches ₹178, tighten the stop-loss to ₹180. Book profits at ₹176.
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