Zinc prices have been coming down over the last three weeks. Indeed, the price fall intensified in the past week. The Zinc Futures contract traded on the Multi Commodity Exchange (MCX) fell over 6 per cent last week. It touched a low of ₹251.10 per kg. It has bounced slightly from there and is currently trading at ₹254 per kg.
Outlook
The outlook is bearish. There is room for the MCX Zinc Futures contract to fall more. The contract can fall to ₹250-₹248 in the short term. However strong support is there in the ₹249-₹247 region. We expect the fall to halt there. A bounce from this ₹249-₹247 support zone can take the MCX Zinc contract up to ₹260 again.
But, if the contract breaks below ₹247, it can come under more selling pressure. Such a break can see the price tumbling towards ₹239 thereafter.
On the charts, the ₹249-₹247 region looks to be a strong support. We expect it to hold at least on its first test.
Trade Strategy
Considering the room for more fall, we suggest traders to stay out of the market now. However, long positions can be taken on dips at ₹251 and ₹248. Keep the stop-loss at ₹244. Trail the stop-loss up to ₹253 as soon as the contract goes up to ₹255. Move the stop-loss further up to ₹256 when the contract touches ₹258. Exit the long positions at ₹260.
Published on April 7, 2025
