Wednesday 28 August 2013

Karachi Stock Exchange: Tip Of The Day

Short-Term:
In line with a weakening theme, benchmark Karachi Stock Exchange (KSE) slid 1.73 % yesterday to violate the 55-day average (22,647) which it had been sustaining since Jan’13. Expect further pressure towards 22,260 and 21,800 levels, with immediate resistance within 22,760 — 22,856 seen blocking any recovery attempt. Sell on strength!















General View:
Easing weekly momentum data coupled with a double-top pattern precursor’s intermediate correction ahead. This can potentially drag (wave 4) the index down towards 20,924 — 19,057 levels where the index would enter the 38.2% to 61.8% retrenchment zone of Jan’13 to July ’13 rally. However, such correction will not reverse the course of primary bull trend, keeping the long-term trajectory intact for 25,000 and 27,270 — 29,039 levels. Investors should keep enough buying power to capitalize at such correction. We noticed strong potential in ENGRO, PSO, PTC, SNGP, NRL, EPCL, FABL and BOP. 

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