Commodity Radar: Initiate long position on MCX Zinc futures for this target

Zinc prices were trading lower on Tuesday amid weakness in the metal pack and tracked prices in the international markets. The prices dragged amid weak metal demand from China while President Donald Trump’s recent tariff threats against the European Union made markets nervous about the prospects of the global economy.

Zinc’s June contracts were trading at Rs 257.15, down by Rs 0.50 or 0.19% around 4:15 pm.

On the LME, zinc prices were trading at $2,706.50, down by $1.50 or 0.06%.

Commenting on the larger trend, Ajit Mishra, Senior Vice President – Research at Religare Broking said Zinc prices are trading steadily, buoyed by China’s renewed economic support measures aimed at reviving its sluggish post-pandemic economy amid mounting global trade tensions.

“The People’s Bank of China cut benchmark lending rates for the first time since October, and major state-owned banks followed by reducing deposit rates. However, broader market sentiment remained cautious due to Moody’s downgrade of the U.S. credit rating and hawkish commentary from the Federal Reserve,” Mishra said.

Tech view
“Zinc prices have been trading in the Rs 252–262 range for the past few sessions. The contraction in movement can be seen as an indication that a fresh move is likely to follow soon. On the hourly chart, prices are hovering inside a symmetrical triangle pattern, where a breakout above Rs. 260 will trigger bullish momentum,” Ajit Mishra, Senior Vice President – Research at Religare Broking said. However, if prices fall below the Rs 254 level, it will signal a pattern failure, and prices could slide towards the Rs 251 mark, he warned.

As a strategy, one can initiate a long position above Rs 260 (June contract), targeting Rs 269, with a stop loss set at Rs 254, this analyst said.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)