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Sunday, May 30, 2021

KSE100 Week 21-2021: Hoorah over 47K!!

Week successfully closed above 47000+/-300, our indicated critical resistance level. The mid-May to mid-June bullish rally has been very well honored. The bulls are ready to charge with plenty of space but slow on motivation. We may see short-term exhaustion as bulls sit down for a rest before they can begin charging again. All major support and resistance levels are marked on the chart below. 

Market capitalization once again crossed over the benchmark 8000 Bn/PKR which has always been a point of cheers and caution at the same time. While the indicators are much more favorable towards a breakout in the long term, we remain conservative in the short term. Money market events that may impact the equities are PIB auctions on 2-Jun, 9-Jun, and MTB auctions on 2-Jun, 16-Jun, and 30-Jun with some, particularly heavy targets. Fears of interest rate hikes have been allayed as the central bank decided to keep it unchanged. 

Looking forward, the strategy shall be taking profits on strength and wait for a suitable dip during the early weeks of June. In line with our stance mentioned in the previous post. 

For anyone wondering, yes we have made the posting style much more concise and eliminated unnecessary repeats of information typically covered in brokerage bulletins. If you enjoyed reading this update, do let us know in the comments section below. 

Monday, May 24, 2021

Week 20-2021: An Update After a Long Time

 Long Eid holidays, academic assignments, and health issues together make a recipe for keeping one extraordinary busy. But once again, here we are with the latest outlook on the bourse for next week. There is no need to re-write the obvious and we cut the red tape and land directly on the topic. Catch up from our several past updates, the rally is on perfectly in the mid of May-June 2021 - well played! 

Looking at the market capitalization, recovery is evident during the post-holidays trading week, the linear trend line is well above the horizontal resistance at 8000 Bn/PKR and we expect a stiff resistance once again around 8300+ Bn/PKR - a level where the index has always struggle to cross. 

Money market events that may impact the equities bourse are OMO maturity on 28th-May, there is no PIB and MTB auction.

Looking forward we expect the healthy trend to continue and the strategy shall be buying low and selling high. It doesn't get more simple than that! If you enjoyed reading his update, do let us know in the comments section below.

Monday, May 3, 2021

KSE100 Week 17-2021: Bulls Get Steaked as Losing Streak Continues!

 Bears roasted a special steak party on Friday as the index unexpectedly lost over -600 points intraday amid a change of trading hours. Overall week losing observed a loss of -444 index points or -0.99%. Which is slightly lower than the week before that. The index has retained itself below the pivot point therefore it remains bearish. 43800 +/- 300 is major support that may render a weak bounce. We expect the market to show some positive recovery between mid-May to mid-June, most probably on post-Ramadan re-opening. All major support and resistance levels are marked on the chart below.

The average weekly market cap once again dropped by -24.66 Bn/PKR but when compared to the index point drop, the losses are really meager. Which signals are bottom out soon but the pressure persis so a wait and see approach is advised. 

Financial events which may impact the equities market are MTB and PIB auction on 6-May. OMO injection of 1,622.80 Bn/PKR was on 30-Apr.