Commodity radar: Buy zinc on dips, but beware of this level, warns analyst Religare

Zinc futures traded positively on Tuesday amid demand for the base metal in spot markets. Domestic prices took cues from their international peers and reached a high of Rs 299 per kg, rising 0.6% intraday.Three-month contracts rose 0.4% on the LME to trade at Rs 3,000 per tonne, while those on SHFE were marginally higher at CNY 22,360/mt.

Commenting on current trends, Ajit Mishra, Senior Vice President Research at Religare Broking, said Zinc’s fundamentals have strengthened as the global supply glut narrowed and London Metal Exchange (LME) inventories remained persistently tight. “According to the latest data from the International Lead and Zinc Study Group (ILZSG), the global zinc surplus fell to 20,300 tonnes in September from 32,700 tonnes in August. During the first nine months of 2025, the refined zinc market recorded a surplus of 120,000 tonnes – slightly higher than the previous year – highlighting a gradual shift in market equilibrium,” Mishra said.

He also highlighted that LME zinc shares are at a near multi-year low of 35,875 tonnes – a level that has pushed spot premiums above futures and caused backward zinc contracts.

Technical View The Religare analyst decodes the technical charts for the December MCX zinc futures. Mishra said the metal has seen a gradual recovery from the recent swing low near Rs 285.80, forming a pattern of higher lows and stabilizing above the short-term moving average, indicating improving bullish momentum. 0979989f-f8c7-436d-866f-769bffa5a1c1.png

The price faced resistance around Rs 303.15 where the upward move stalled and is now consolidating near the Rs 297-Rs 298 zone. As long as Zinc remains above the support area of ​​Rs 294, the trend is likely to remain positive in the coming week.

A sustained move above Rs 300 could open the way to Rs 305-308, Mishra said while warning traders that any dip below Rs 294 could weaken momentum.

Overall, the near-term outlook is moderately bullish, with buying on dips favored until key support breaks, Mishra said.

Also read: Commodity radar: For every 20-30 paise of rupees falling, domestic gold gains Rs 100-150/10g. LKP analyst advises buying on dips

(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)