The price of Zinc has been trading in a narrow range of Rs 90 to Rs 93.80 levels since it witnessed a sharp correction from the highs of Rs 105.15 levels as on 13th Sep, 2011.
But the most important observation to be made on the charts of Zinc is the positive divergence displayed by the RSI indicator.
It signals that the downward movement of the price could have lost force and in all
likelihood this can lead to some kind of an advance.
Hence, the current technical setup suggests that a sustained break above the 8 day moving average placed at the Rs 93 levels will see the price of zinc testing levels of Rs 95.60 and/or Rs 97.50 levels on the upside.
We recommend traders to buy on a break above Rs 93 levels with a stop loss placed below Rs 91.45 levels for upside targets of Rs 95.60 / Rs 97.50 levels expected to be achieved over the upcoming 3- 4 sessions of trade.
MCX ZINC OCT. CONTRACT OPEN Rs 92.40 HIGH Rs 92.75 LOW Rs 90.75 CLOSE Rs 92.50
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