06 Dec 2017
In our previous mail we had hinted for a breakout in zinc prices ( new reader may scroll down) and as expected it broken out of 3100-3200 mark .As seen on the chart , Zinc LME futures prices were holding to 3100-3130 mark for some time and the movement was restricted within the rising wedge as seen on the chart. However the rising wedge has broken and crucial support was broken yesterday confirming the near term trend looks for deeper correction to at least 2975 levels( last seen in September).For non-technical people, a rising wedge is a bearish pattern that signals that the security is likely to head in a downward direction. The trend lines of this pattern converge, with both trend lines slanted in an upward direction and once broken the moves southward.
On the upside good selling interest will revive at 3120-3140 and on the downside we keep a target of 2975. In LME MCX chart as shown below , the trend line was broken at 206 confirming the downward correction. One can expect the prices to go down to as low as 192-195 levels in the near term with upside selling pressure to revive at 203-206.