Bias for MCX Crude Oil remains negative; 200-DMA is the key support

Meanwhile, the Natural Gas futures soared nearly 79 per cent in the last 15 trading sessions to a new high of Rs 760; the commodity could witness some profit-taking now.

The MCX Crude Oil futures continued to trade with a negative bias even as Natural Gas futures galloped to a record high of Rs 760 in a jiffy. Going ahead, the 200-DMA is the key support for Cured Oil futures, while Natural Gas futures may witness some profit-taking.

Crude Oil

Bias: Negative

Last close: Rs 7,664

Resistance: Rs 7,835, Rs 7,960

Support: Rs 7,480, Rs 7,240

The MCX Crude Oil futures continued to trade with a negative bias albeit in a narrow trading band. On the positive front, Crude Oil futures managed to sustain above the 200-DMA (Daily Moving Average) placed at Rs 7,240; this level holds the key going forward.

Among the key momentum oscillators on the daily chart, the 14-day RSI (Relative Strength Index), MACD (Moving Average Convergence Divergence) and the Slow Stochastic have turned neutral, a positive crossover can lead to a pullback in Crude Oil prices.

However, the bias on the weekly chart continues to remain negative, with Crude Oil futures seem headed towards the lower-end of the weekly Bollinger Band at Rs 7,200-odd level, below which prices can slide to Rs 6,915 - its 50-WMA (Weekly Moving Average).

According to the weekly Fibonacci chart, sustained trade below Rs 7,480, can trigger a fall to Rs 7,355 - 7,260 - 7,165 on the MCX Crude Oil futures. On the upside, sustained trade above Rs 7,660 can boost the prices towards Rs 7,835 - 7,960 - 8,150.

On Wednesday, the MCX Crude Oil August futures are likely to trade in a broad range of Rs 7,470 to Rs 7,860, with the commodity likely to seek support around Rs 7,595 - Rs 7,545 - 7,505; whereas on the upside Crude Oil could face resistance around Rs 7,735 - 7,785 - 7,820. 

Natural Gas

Bias: Negative

Last close: Rs 706.80

Support: Rs 687.20, Rs 664

Resistance: 735

The MCX Natural Gas July futures witnessed a phenomenal rally of nearly 79 per cent from the low of Rs 425 on July 05 to a record high of Rs 760 on July 26 in a matter of mere 15 trading sessions.

Given the sharp rally, the weekly MACD is now on the verge of turning favourable. However, the price-to-moving averages action on the daily charts remains negative, as the 20-DMA at Rs 553 is still below the 50-DMA at Rs 595. Further, the daily Stochastic Slow too is showing some signs of tiredness.

In the near term, Natural Gas futures could face some resistance around the higher-end of the Bollinger Band on the daily chart at Rs 735-odd level. Whereas on the downside, the commodity could slip to Rs 650-odd level owing to profit-taking.

More meaningful support for Natural Gas is seen around Rs 595 level, which is the 50-DMA. 

According to the weekly Fibonacci chart, the bias for the remainder of the week for Natural Gas futures is likely to remain bullish as long as the commodity trades above Rs 687.20. On the flip side, the bias could turn negative on break of Rs 664. 

On Wednesday, as per the daily Fibonacci chart, MCX Natural Gas futures are likely to trade in a broad range of Rs 671.90 to Rs 741.70. The commodity could seek support around Rs 694.40 - 685.20 - 678.50. On the upside, the Natural Gas futures are likely to face resistance around Rs 719.20 - 728.40 - 735.