Comments
Natural gas futures (continuous contract) on the Multi Commodity Exchange (MCX) declined to the support at ₹210 last week, and has now rebounded in line with our expectations. While it closed at ₹209.3 on Friday, it opened with a gap-up on Monday. It is currently trading at around ₹216.
For the purpose of further analysis, we are considering September futures as the August contract’s expiry date is August 28.
The September futures is currently hovering at ₹226. While a resistance band is present between ₹235 and ₹240, support is placed at ₹215. At the moment, the contract is hovering around the mid-point of the region.
If the contract rallies and breaks out of ₹240, it could see a quick rally to ₹250. But if it falls below ₹215, the price could head lower to the ₹200-205 band.
Trade strategy
Although the likelihood of a rally looks high from here, the risk-reward is not attractive. Therefore, traders can stay on the fence for now and buy if the price softens to ₹215. Stop-loss can be at ₹208. Book profits at ₹235.
Traders holding longs in August series can exit and consider the above trade recommendation.
Comments
COMMENT NOW
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.