The price of aluminium futures has been moving in a narrow band over the last week. Nevertheless, the broader uptrend remains valid.
The March futures has largely been oscillating between ₹257 and ₹260 over the past week. Note that aluminium futures marked a high of ₹266.75 nearly two weeks back and moderated.
However, the uptrend has not come under threat. So long as the contract stays above ₹256, the near-term outlook will be positive.
In case the contract slips below the support at ₹256, it can extend the decline to ₹248. A breach of this can trigger a fall to ₹236. Until the price is above ₹236, the medium-term trend will be bullish.
Broadly, we expect the aluminium futures to resume the rally from the current level as the uptrend is true at the moment. It can rise to ₹270 in the short-term.
Trade Strategy
Last week, we suggested buying aluminium futures (March) at ₹257. Hold on to this trade and maintain a stop-loss at ₹252. When the contract rallies to ₹265, move the stop-loss up to ₹260. Book profits at ₹270.