Zinc futures on the Multi Commodity Exchange (MCX) has been facing resistance at ₹250 over the past few sessions. As the contract continues to hover around this price band, the chance of a corrective decline is increasing.
From the current level, the April zinc contract is likely to see a dip to ₹235 – its 20-day moving average. Post this move, we can expect the contract to resume the uptrend, which can lift the contract to ₹265.
On the other hand, if zinc futures slip below ₹235, it can extend the downswing to ₹228. A decline below ₹228 can turn the short-term outlook bearish.
Stay on the fence for now and go long when zinc futures dip to ₹235. Place initial stop-loss at ₹226.
When the contract rallies past ₹250, raise the stop-loss to ₹238. Further tighten the stop-loss to ₹248 when the price touches ₹255. Book profits at ₹265.