Buy MCX Zinc Feb around Rs 117-115; target Rs 127: Angel

Angel Commodities has come out with its special technical report MCX Zinc. According to the research firm, one can buy MCX Zinc February contract between Rs 117-115 with a stop loss of Rs 112 for targets of Rs 123-137.

MCX Zinc prices after making a low of 49.85 in the month of December 2009 has seen a sharp rally towards 123.20 levels. Later prices corrected towards 86.05 levels in the month of October 2011 which is exactly the main trendline support and moved higher towards the trendline at 108.90 levels.

As seen in the continious monthly chart above prices have been moving in the Ascending Triangle pattern with the trendline breakout at 106.95 levels, But prices finally broke out the trendline breakout in the month of November 2012 and closed sharply higher. Later prices touched exactly the the breakout of 106.90 levels in the month of January 2013 and moved higher crosing the previous high at 115.90 levels towards 118 levels, but closed lower below the highs of 115.90. but prices now in the month of february 2013 have crossed that high of 115.90 and are now trading at 117.60 levels.

Hence as per the pattern we expect zinc prices now to find very good support at the previous high of 115.90 levels and then move higher towards the expected target price of 137.45 levels as per the Ascending triangle pattern. Trading consistently below 115.90 levels or closing below 115 levels would give correction initially towards the trendline breakout support at 106.95 levels and then finally towards the main trendline support now at 103.70 levels. Multiple closing below 103.70 levels would confirm that Ascending Triangle pattern has been negated and thereby major correction can be expected initially towards 89 levels and then finally towards 76 levels. Trading consistently above 116 levels now would renew the Ascending trangle pattern and a sharp bull rally can be expected initially towards the high at 123.20 levels and then finally towards the expected target at 137.45 levels. So we suggest now to Buy MCX Zinc February prices in dips at 116 to 115 levels and then expect to hit 123 levels and then 137 levels.

Strategy (7-10 Days): Buy MCX Zinc February between 117-115, SL-112, T1-123 & T2- 137

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment

Read More