MCX Zinc Oct: Sell CMP @ 112.65/Kg | Stop @ 113.50 | Target @ 109 – 105
MCX Zinc Outlook Bearish, Resistance At 113.50 Should Hold
Zinc futures for October delivery on the MCX has formed a Broadening Pattern. The contract is currently trading at 112.65 and faces resistance at 113.50, just near the rising trend line.
A Broadening Pattern occurs during high volatility, when prices shows great movement with little direction. The pattern was formed after zinc fell sharply from 123.30 to touch the low of 110.
The above chart indicates that zinc is consolidating in a wide range. If zinc fails to trade above 113.50 then prices are expected to drift lower to touch 109. A break below this level could see prices falling to the lower trend line at 105.
However, if zinc crosses the resistance of 113.50 then prices may rise to 116-120 levels.
