Whatever fall has taken place is in the past three weeks, of which last two days have recorded the sharpest dip. With the latest fall, the metal has broken its recent bottom of $985.

In fact, if one were to leave the 1997 rally which was mainly on account of Chinese short-covering, the performance of zinc has been far from impressive. It has moved in a narrow range.

During September last year, it touched a high of $1,720 but failed to sustain the level. From that peak, it registered a straight fall to a level of $1002. From that level, as a result of a technical rally, it touched a high of $1,118 in April 1998. However, as these levels failed to attract enough buying, it again dipped to $985 in June.This was followed by a short rally up to a level of $1100. Since then, it has been on a downward spiral.

Although, zinc has been forming lower tops and bottoms, which are undoubtedly bearish signals, it enjoys a strong long-term support in the range of $920-$940. This leaves little scope for a further decline, as far the technical position goes. But this does not mean that a sharp rally is expected from the current level. This is simply because the position of oscillators like Relative Strength Index (RSI) and moving average convergence divergence (MACD) is bearish. Even if a rally takes place, it would not be sustained. As such, since the scope for further fall is limited, zinc prices may move in a narrow range in the coming weeks.