Karachi, December 18, 2017 (PPI-OT): KSE100 – Making Recovery
The benchmark KSE 100 Index bounced off from a falling trend-line support at 37,700 as the short-term grossly oversold momentum of indicators drew buyers’ attention on Friday which allowed the Index to close above 38,600 mark – respecting the long-term trend-line support again. Moving ahead, the upside move will depend on the direction of the break of near term levels as per daily charts. A break above nearby resistance at 38,900 would pave the way towards the next barrier at 39,500.
Ability to hold onto this area would target the descending resistance at 40,200/ 300 levels. At this point, stochastic and RSI are also showing oversold readings on weekly time frame signalling that buyers could hop in the up-trend sooner or later. The inclines however should be treated as an upside correction in order to relieve the indicators and not as the termination of the current bearish structure.
On the flipside, a down turn from either resistance would be a sign of completion of upward correction. In that case, any break below 37,700 support would likely introduce fresh downside risk to the levels of 37,100 and 36,500 next. Further down, if seen, would open the door for a move lower to 38.2% Fib of 4,781/53,127 larger ascend at 34,659 level.