Zinc prices have been oscillating in a range for more than two weeks now. The Zinc Futures contract on the Multi Commodity Exchange (MCX) has been trading in a range of ₹274-₹292 per kg for more than two weeks now. Within this range, the price has been coming down now. The contract is currently trading at ₹283 per kg.
Outlook
Support is at ₹270 for the Zinc Futures contract. Resistance is around ₹295. So broadly, ₹270-₹295 can be the wider trading range. Within this range, the chances are high for the price to fall in the coming days. However, the region between ₹275 and ₹270 will continue to give support and limit the downside
As such we can expect the MCX Zinc Futures contract to reverse higher from the ₹275-₹270 support zone and rise back to ₹290-₹295 in the short-term.
In case the contract declines below ₹270, the downside can extend to ₹265.
The contract will gain bullish momentum if it breaks above ₹295 decisively. If that happens, the contract can rise to ₹315-320.
Trade Strategy
Traders can wait for a fall and go long at ₹278 and ₹273. Keep the stop-loss at ₹267 initially. Trail the stop-loss up to ₹282 as soon as the contract goes up to ₹286. Move the stop-loss further up to ₹287 when the price touches ₹290. Exit the long positions at ₹293.