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A fresh leg of down move has begun in copper futures traded on the Multi Commodity Exchange (MCX) in line with our expectation.
The contract continued to face resistance at ₹360/kg and plunged from a high of ₹357.6 recorded on January 22 – declining over 5 per cent over the past week.
It is currently trading near ₹337.
The support at ₹340 has been breached in this fall. . This level will now act as a resistance.
The next key resistance is at ₹353. The overall downtrend remains intact.
A fall to ₹325 or even ₹320 appears likely now.
Traders with a short-term perspective can initiate fresh short positions at current levels. Stop-loss can be placed at ₹344 for the target of ₹327.
Medium-term traders who have initiated short position a couple of weeks back can continue to hold their positions.
But revise stop-loss lower to ₹357 from the earlier level of ₹362.
Retain the target at ₹320. Accumulate more shorts if an intermediate rally to ₹353 is seen.
The downside pressure for the contract will get some relief only if it breaks above ₹353 decisively. But such a strong rise appears unlikely at present.
Note: The recommendations are based on technical analysis. There is a risk of loss in trading.
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