Zinc weekly outlook (Price moving in an up sloping channel) 01 to 05.09.2014

Zinc September contract inched 1.05 rupees up to settle at 142.90 this week. Zinc September contract has took support at 10 weeks SMA and reversed nicely. Prices are moving nicely in an up sloping channel. 10 weeks SMA is above 20 weeks SMA and 20 weeks SMA is above 50 weeks SMA keeps a nice uptrend in place. MACD has fallen from overbought territory and now getting support near 70 that indicates strong bullish forces in this counter. MACD is also staying above signal line and line zero and keeps uptrend in place. Support is now seen near 137.60. Stability above that level remains bullish for this counter and any sustained recovery above 147 zones would bring more charm and then we will see a rally towards 152-55 zones. Immediate resistance is now seen near 143.60 any sustained move above this level would open the doors for a retest to 146 zones. Key support placed at 137 and failure of this level is very less likely. In case of failure below 137 we will see some bearish trigger in this counter and then primary support would be at 133 and then at 130 zones. Zinc Trading range for the week is expected among the key support at 137.5 and resistance at 143.7. Recommendation: Buying zinc on declines around 141.50-141 with stop loss below 139 for targeting 145-147-149 and more upside might be appropriate. In alternative scenario buying above 143.70 with stop loss below 142 for targeting 147-149 and more upside might be appropriate. In alternative scenario selling below 137.50 with stop loss above 139 for targeting 133 and more down side might be appropriate.