Lead futures (continuous contract) has been appreciating since the beginning of this month. While the rally has not been sharp, the price action hints at a shift in the trend.
Early this week, the contract broke out of a resistance at ₹182.50, a positive sign. Also, the 20-day moving average has now crossed over the 50-day moving average, an indication of the trend turning positive.
Notably, since June 2021, lead futures has remained within the broad price band of ₹175-196. Last month, the contract rebounded from ₹175. So, it is likely that lead futures can gradually move up towards the upper boundary of the range at ₹196.
Considering the above factors, there is a potential swing trade opportunity in lead futures.
Trade strategy
In early March, we had recommended buying lead futures (March) at ₹180 with a stop-loss at ₹172. Retain this trade. But revise the stop-loss up from ₹172 to ₹179.
When the contract touches ₹190, modify the stop-loss to ₹186. Liquidate the longs at ₹194.
Note that on Friday (March 14), only the evening session will be open to trade as the morning session will be closed on account of Holi.
