The continuous futures of copper on the MCX (Multi Commodity Exchange turned its trend downward in March from about ₹880. It fell to mark a fresh 52-week low of ₹601 in mid-July. But then, the bears lost traction and consequently, the prices started to rise. However, since the price band of ₹675-700 is a strong hurdle, the contract was unable to extend the recovery beyond these levels.

Currently trading at around ₹660, we expect the contract to see a decline from here. That is, the recent rally is more of a corrective one and the broader bearish inclination unchanged.

But note that there could be some consolidation before it could resume the next leg of downtrend.

We had already suggested initiating short positions at around ₹660 with stop-loss at ₹715. Continue to hold these shorts positions. One can also initiate fresh shorts now with the same stop-loss of ₹715. Bring the stop-loss down to ₹670 when the contract slips below the support of ₹600. Tighten it further to ₹615 when the contract touches ₹585. Exit the shorts at ₹550. The price level of ₹550 is a strong support against which the contract could see a bounce.

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