One of the worst post-COVID19 performances of the markets with obliteration of -2,049.27 points or -4.47%. The free fall breached all supports and fell as low as 43000 +/-300 - pre-COVID19 resistance acting as support. Although we had assigned a low probability of KSE100 breaking below its major support of 43800 +/- 300, the risk was always on cards and warned appropriately. Although losses were pared on the last trading day when the index made a sharp recovery of +1008 points to close at resistance (previous support), the trend is already wearing out. We suspect the market may go through a reset cycle which may lead to a fall as low as 40K shall the momentum remains in decline. On the positive side, sustaining above its major pivot zone of 45100 +/-100 may signal a fresh accumulation cycle towards a new high. Looking forward, the strategy shall be to book profits on strength or wait and see approach. Please read the last few week's updates to establish a better understanding of this posting.
One of the highest weekly declines was observed with a net loss of -338.22 PKR/Billion from weekly average capitalization. It appears that the 8000+ billion/PKR mark is really a tough line for bulls to cross. This is the third time major rejection has been observed at this level.