Sharekhan bearish on Zinc; can touch Rs 110/kg

Sharekhan has come out with its report on Zinc. According to the research firm, unless the high of Rs 114 is crossed on a closing basis, the price can come down till Rs 110.

Zinc: A bearish potential

From the low of 96.30, the MCX zinc has rallied smartly. It has reached near a region where it had faced resistance multiple times in the recent past. Thus, the price has started facing a resistance & that is evident from a bearish pattern formation. It has formed a wedge and has broken on the downside. The fall is subdividing into lower-degree waves.

The daily momentum indicator is showing a negative divergence and has triggered a bearish crossover. Thus, unless the high of Rs 114 is crossed on a closing basis, the price can come down till Rs 110 (junction of the 40- daily exponential moving average and the daily lower Bollinger Band)-106.5 (the 20-weekly moving average).

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To read the full report click on the attachment