MCX Lead June traded positive following a short-covering rally at LME.

18 June 2008 09:51:31

MCX Lead June traded positive on Tuesday following a short-covering rally at LME. Lead closed near 79.85 with gains of almost 3.38% after registering days high near 80.20.Beafore market dropped to a low of 76.50 following heavy inventory data at LME.

Another massive jump in LME lead stocks is set to weigh on prices but this might be a bear trap by a player wishing to push the market down in order to buy it, says a broker. Notes material is going into warehouses but the warrants aren't being released, meaning it is tightly held and unavailable to the market.

The speculative short in LME lead has grown to record levels and with open interest at levels not seen since 2003, being short of lead has become a very "crowded" trade. Covering may prove difficult as a result.


LME stocks are up 11,550 metric tons, mainly in Dubai and Singapore, to 94,875 tons - last seen in August 06.

MCX Lead June -Technical outlook:

The daily stochastics have crossed over up which is a bullish indication. The prices closed below short term and medium term EMA, which supports bears. MACD is heading downwards in positive region, showing decrease in bullish momentum.

Technical are neutral to bearish signalling sideways to lower prices in the near term. Initial support for the market is around 77.5 levels. If broken can see further fall to 75.2 and 73.8, If market holds above 78.9 further rally can be seen towards 81.2 and 82.6

Recommendations –MCX Lead June:
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