Commodity Bets That Could Bring Profit

Precious metals are on a drop as yields are increasing. Here are some commodity notes that analysts say can perform stable returns in the near term.

Gold | Sell | Target: Rs 43,800

Technical indicator RSI is hanging under the 30 marks on the daily chart, noting that the counter is in an oversold condition. Traders should anticipate a bounce near Rs 45,600 to get a sell position, for a target price of Rs 43,800 with a stop loss at Rs 45,870.

The US bond yield at a 10-year high of 1.66 percent supports the US dollar, significantly in times of critical weekly candlestick patterns.

Gold broke under the outstanding support of Rs 45,000, and it appears set to make a serious effort to tap the Rs 43,800 level, with room to slip to Rs 42,500.

Lead | Sell | Target: Rs 162

Traders should practice a sell position in MCX lead futures this week from the level of 166.00, for a spot price of Rs 162.50-162 with a stop loss at Rs 168.70. MCX lead futures proceeded to move in a downtrend after the breakout of the support level of Rs 168.05.

The price has traded under the 15-SMA on the intraday chart and closed beneath the immediate resistance at Rs 164.30. A critical support level to follow would be Rs 161.60.

Zinc | Sell | Target: Rs 213.50

Technically, traders should go for a sell-on-high strategy in MCX zinc futures from the descending channel’s resistance at Rs 219.50. One has to watch for a target of Rs 213.50 with a stop loss of about Rs 224.75.

Zinc futures have traded with the bearish viewpoint, with the March futures having formed a megaphone chart pattern. It moved sideways lately with some correction inside the descending channel.

If the prices settle under the critical support level of Rs 213, a more bearish momentum can be expected ahead. On the downside, the initial support level is at Rs 211.50-210, whereas Rs 222.40 would be a significant resistance zone.