KASB Securities Limited and Economics Research- The Keystone – Equities

Karachi, July 27, 2012 (PPI-OT): KSE-100: KSE-100: Bollinger Bands continue to compress

According to KASB Securities Limited,

• The index formed a double top at 14,617 points which led to the intraday pressure. Formation vis-à-vis volumes suggest that consolidation is still in place.

• The Bollinger Bands narrowed down further which also suggests a drop in volatility and continued consolidation.

• KASB Securities Limited suggests accumulating on weakness.

Analysis and Overview:
The index opened positive however after touching its day’s high, took to a gradual downtrend to close marginally in the red. Volumes showed a decent improvement of 42% however stood at a not so impressive 81 million. The index formed a double top at 14,617 points which led to the intraday pressure. Formation vis-à-vis volumes suggest that consolidation is still in place.

The Stochastic Oscillator continues to decline and is gradually approaching the oversold region while the RSI is neutral and hovers just below the overbought region. Additionally the Bollinger Bands narrowed down further which also suggests a drop in volatility and continued consolidation.

KASB Securities Limited suggests accumulating on weakness.

The first support is at 14,495 points and the second support is at 14,435 points. The first resistance is at 14,613 points and the second resistance is at 14,670 points.