KASB Securities Limited and Economics Research- The Keystone – Equities - AsiaNet-Pakistan

KASB Securities Limited and Economics Research- The Keystone – Equities

[ 0 ] March 9, 2012 | | Share:

Karachi: KSE‐100: Formation suggests distribution and bearish divergence

According to KASB Securities Limited,

• The index’s formation is a doji star which is yet another bearish formation and compounds Wednesday’s Engulfing Bearish Formation. Moreover substantially high volumes vis‐à‐vis its formation over the past two sessions suggest distribution.

• The Stochastic Oscillator maintains its downtrend as well as sell signal which makes its formation a bearish divergence.

• KASB Securities Limited maintains KASB Securities Limited’s cautious stance on the market.

Analysis and Overview:
The index opened positive and took to a steady uptrend however after touching its day’s high, witnessed profit selling to close marginally below its open. Volumes increased by 12% and stood at 358mn. The index’s formation is a doji star which is yet another bearish formation and compounds Wednesday’s Engulfing Bearish Formation. Moreover substantially high volumes vis‐à‐vis its formation over the past two session suggests distribution.

The Stochastic Oscillator maintains its downtrend as well as sell signal which makes its formation a bearish divergence. Moreover the RSI is flat however maintains its sell signal. Additionally, as a composite, most of the index’s key stocks have either created bearish formations or have become overbought.

KASB Securities Limited maintains KASB Securities Limited’s cautious stance on the market.

The first support is at 13,204 points and the second support is at 13,132 points. The first resistance is at 13,348 points and the second resistance is at 13,423 points.

Category: Brokerage