Zinc futures price reversed downward after facing strong resistance from the trading zone between from 2871 to 2978. Downtrend trend continued from December 15th – 22nd, 2016 and then a quick bounce back from 2548 to 2636 on the same trading session.
On analysis the movement of zinc futures price in different time zones (monthly, weekly, daily, 5 hour and 1 hour), I find that zinc futures price has crossed a tough long term resistance at 2620 during its recent uptrend rally, which started from October 24th, 2016 and reached up to 2980, a level of overbought zone created after a continued rally.
I find that a long term resistance, once crossed by a commodity futures price during a strong uptrend current becomes its strong supportive zone when it tries to go downward. Now the zinc futures are trading at a nearby level of its supportive zone, which once used to be a strong resistive zone during every uptrend moves, what zinc futures tried in past.
Now, my supposition is that zinc futures price will move in a fixed trading zone and I would like to define it as a "Decisive Trading Zone". Any move outside this trading zone will decide its future directional moves.
Disclaimer: This analysis is purely based on the technical observations. I do not have any position in Zinc Futures. One can create position in Zinc futures at his/her own risk.