Karachi, August 18, 2017 (PPI-OT): Correction Deepens Amid Oversold Momentum
The benchmark KSE has fallen below the July’17 low 43,027 level during the session today indicating continuation of intermediate correction. This exposes the deeper support between 41,897 and 41,456 levels. The aforesaid support coincides with the 377-day Fibonacci average (42,559). Technically, the market is oversold and low volumes accompanying decline confirm the corrective nature of fall. Immediate resistance resides around 43,938 level. A break above 44,332 level is required to reverse the downtrend.
According to our preferred Elliot wave count, the index is falling in the fourth intermediate corrective wave of fifth primary degree. In the process, the correction is approaching the 50% retracement of last intermediate run (Feb’16 to May’17) at around 41,701 level. Below there, the 61.8% retracement resides around 39,004 level. If our count is correct then completion of intermediate correction should resume the bullish trend to challenge May’17 high (53,127) to complete the fifth Primary cycle. Investors are advised to accumulate on weakness up to the above mentioned retracement levels.
13-day Leaders: CJPL, PICT, PSO, MUREB, PAKT, NATF, SPWL, NESTLE, BWCL and BAFL
13-day Laggards: FML, PSMC, EFOODS, MLCF, PAEL, CSAP, IDYM, ARM, ACPL and SEARL