Elixir Securities Limited -Elixir Grid

Karachi, June 25, 2018 (PPI-OT): KSE100: Nosedives to May’s Lows (41,600/500)

The benchmark KSE 100 Index crushed the short-term ascending support (43,480) last week while a continued drop below 43,100 mark strengthened the bears resulting in a strong selloff that dragged the Index down to the lows formed in preceding month (41,600/ 500). In doing so, a particularly oversold stance has been achieved on daily time interval which is prone to a recovery. For now, If the former lows keep the losses in check we may expect a recovery to the levels of 42,028 and 42,432 (38.2% Fib of 43,825/ 41,557 descend) next. Further respite can be seen till 42,691/ 700 levels. However these inclines should be treated as a short-term recovery in order to relieve the indicators. This development will not abandon the recent bearish structure.

A down-turn from either resistance would confirm the resumption of the bearish spell as the Index could be completing its correction ahead of moving back lower. In that case, a revisit to 41,550/ 450 is on the cards while a break would turn attention to 41,000/ 40,800 levels. This area coincides with a weekly 144 EMA adding more to its strength as a potential floor. Further down, if seen, a cut through here would open the door for a move lower towards the next supports at 40,500/200 levels.

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