Commodity Radar: Zinc spark on ceasefire buzz. Time to enter long for these targets

A ceasefire in the Israel-Iran conflict announced by US President Donald Trump lent a fresh impetus to base metal prices, which traded positively on Wednesday. Zinc futures on the MCX were up by 0.20% and trading at Rs 254.60 per kg.

The range-bound trade indicates a cautious approach by the traders who are waiting to see how the development unfolds on the ground.

The decline in the dollar index (DXY) has been helping commodity prices remain in check. In the last one month, the DXY is down 2% while going down by 1% in the past five sessions. It has slipped below 98 against a basket of six top currencies and is hovering around 97.95, gaining by 0.09% on an intraday basis.

A lower greenback makes imports of dollar-denominated commodities like metals cheaper for countries.

Commenting on the current trends, Ajit Mishra, Senior Vice President, Research at Religare Broking, said that zinc prices have been steady, supported by better-than-expected Chinese retail data, although the escalating Israel-Iran conflict capped gains. “China’s May economic data was mixed, as its retail sales data exceeded expectations, even as industrial output missed the forecast. Ongoing weakness in the property sector also persisted during the month, with new home prices declining,” he said.

Also read: Gold Price Prediction: Yellow metal prices plunge by Rs 2k in 2 days amid Iran-Israel war de-escalation. Is the shine fading?

Technical outlook

Decoding the hourly MCX Zinc charts, Mishra said that the pattern indicates tight consolidation between Rs 250–254, with price hovering above short-term EMAs. An inverse head and shoulder pattern on the hourly timeframe hints at an imminent breakout, he said, adding that the momentum indicators favour an upside move, but bulls must clear Rs 259 decisively to validate continuation.

Zinc Hourly Chart

Trading strategy:

Entry (Long): At Rs 253–254.

Stop-loss: Rs 249

Targets: Rs 260 followed by Rs 264

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)