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Saturday, May 30, 2020

Week 22-2020 Closing Notes

Note: There is no week 22-2020 mid update due to Eid Holidays.

We reiterate our stance in the previous update (link-1) with the same analysis remaining valid for the current and week 23-2020 ahead.

Intraday market capitalization hints towards profit-booking while the weekly average shows negligible erosion. Due to holidays, the data is skewed. 

Sunday, May 24, 2020

Week 21-2020 : Chaos Before Holidays

Note: There is no week 21-2020 mid update since the trading week was short by one day due to the Eid 2020 Holidays. 

A turbulent trading week closed in the negative, owing to profit booking due to longer than expected Eid Holidays ahead. 34100 +/- 100 once again came into play as an intraday resistance and gave a mild rejection. While looking forward, we expect the consolidation to continue keeping KSE100 under the elastic effect of bouncing between support and resistance. 33600 +/- 100 is expected to be tested once again as support while 34800-35500 +/- 100 retains their crown as channel top (for time being).

Weekly average capitalization showed strong growth of +109.50 PKR/Billion and the overall week remained as compared to previous one. 

Friday, May 15, 2020

Week 20-2020 Closing Notes: The Bulls Take Charge

After narrowly treading between a major support and resistance zone, KSE100 finally rises above 33600 +/- 100 and shows another day of strong performance. In previous sessions, the index has continued to see-saw without hitting any major support or resistance firmly and was dubbed the "snake dance". Looking forward, the momentum is expected to remain positive with 34100 +/-100 posing as a weak intraday resistance. While the market channel top remains unchanged at 34800-35500 +/- 100. Buy the dip should be the stance. Another 100 BPS rate cut will be a positive sentiment driver. (SBP cuts interest rate by 100bps to 8%)

Intraday market capitalization has gained +48.06 PKR/Billion while weekly average capitalization once again shows weakness with a meagre gain of +10.48 PKR/Billion.

Wednesday, May 13, 2020

Week 20-2020 Mid Update: The Snake Dance

KSE100 has continued its see-saw behaviour, a hallmark of correction and once again closed above a major resistance of 33600 +/- 100. Instability is expected to continue throughout the consolidation phase as sectors exchange hands. We advise accumulating in favourable sectors which are clinging near to their supports. 

A marginal gain of +2 PKR/Billion was observed intraday which registers as neutral impact. 

Saturday, May 9, 2020

Week 19-2020 Closing Notes

Looking back at our previous updates (link-1link-2 ) KSE100 has continued to face rejection midway, before hitting its predicted major resistance of 34800 +/-100 and is likely going through a change of hands between sectors. On the bottom side, 33600 +/- 100 support is already broken and 32400 +/- 100 is yet to be tested. We carry forward our stance from the previous update that a moderate dip is necessary to act as a refresher and recharge the bulls for next rally. Overall KSE100 appears to be doing well and will make a strong resurgence after the correction phase is over. 

Intraday market capitalization went up by meagre +9.12 PKR/Billion but weekly average shows strength with a gain of +143.61 PKR/Billion. 

Happy trading!

Wednesday, May 6, 2020

Week 19-2020 Mid Update

KSE100 has continued to dip since the week opening, treading closer to our third scenario as per the previous update (link-1). Looking forward the trend so far has remained sideways and we expect a moderate dip ahead to act as a refresher and recharge the bulls for taking it to the next resistance level.  Support falls at 33600-32800 +/- 100 and resistance remain steady at 34800 - 35500 +/- 100.

Market capitalization has been fluctuating in a narrow range with no significant gains or losses so far. 

Major event today was PIB auction which has bought in mixed results. Source: Auction Result: SBP Sells T-Bills worth Rs.418.37 Billion (May 06. 2020)