KSE-100 Index: Reaction From 200-DMA Results In Negative Closing Below Previous Double-Bottom

The Keystone for June 01, 2010

First support 9,259 points, second support 9,142 points; first resistance 9,390 points, second resistance 9,448 points

Analysis and Overview:

The index opened marginally negative and after touching its day's high, took to a steady downtrend to close well negative. Volumes declined by 36.07% and stood at 60.52 mln. The index reacted negatively from the 200-DMA and took to a downtrend to close below the previous double-bottom at 9,355 points. This is bearish and is suggestive of further downside.

The Stochastic Oscillator on the daily chart has once again generated a sell signal, while the RSI on the daily chart too has shown weakness. Moreover the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart. Also the 30-DMA has cut the 50-DMA from above with the former likely to cut the 100-DMA from above.

The first support is at 9,259 points and the second support is at 9,142 points. The first resistance is at 9,390 points and the second resistance is at 9,448 points.

KSE-100 Index: Closing below 200-DMA And 30-week MA A Bearish Sign; Sell Signal On Monthly Chart Generated

The Keystone for May 31, 2010

First support 9,451 points, second support 9,362 points; First resistance 9,569 points, second resistance 9,633 points

Analysis and Overview:

The index opened marginally positive and after touching its day's high, took to a downtrend, however after forming a double-bottom at its day's low, recovered to close in the green. Volumes declined by 8.85% and stood at 94.66 mln. Average weekly volumes were up by 22.53% from 83 mln to 102 mln, while the index declined by 350 points. This suggests that the decline came in with volumes, which is bearish. On the daily chart, the index closed below the 200-DMA, while on the weekly chart it closed below the 30-week moving average.

The Stochastic Oscillator on the daily chart maintains its uptrend, while on the weekly chart it maintains its sell signal. Moreover the Stochastic Oscillator on the monthly chart has generated a sell signal. The RSI on the daily chart has shown some improvement, while on the weekly and monthly chart maintains its downtrend as well as sell signal. Moreover the MACD on the daily and weekly chart maintains its sell signal.

The index could see a short-term pullback however, the overall trend remains bearish.

The first support is at 9,451 points and the second support is at 9,362 points. The first resistance is at 9,569 points and the second resistance is at 9,633 points.

KSE-100 Index: Formation And Closing Below 200-DMA Suggests Further Downside Risk

The Keystone for May 28, 2010

First support 9,354 points, second support 9,261 points; first resistance 9,505 points, second resistance 9,562 points

Analysis and Overview:

The index opened flat and after touching its day's high, took to a steady downtrend to close well negative. Volumes were marginally lower by 4.83% and stood at 103.85 mln. After opening above the 200-DMA, the index failed to sustain itself only to close below it. Moreover the formation created in the process is a "Dark Cloud Cover" formation which suggests further downside risk.

The Stochastic Oscillator on the daily chart has started to stall just above the oversold region, while the RSI on the daily chart has once again shown weakness. Moreover the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart. Also the 30-DMA has cut the 50-DMA from above with the latter now conforming to a downtrend as well. This confirms the view that the overall trend remains bearish.

The first support is at 9,354 points and the second support is at 9,261 points. The first resistance is at 9,505 points and the second resistance is at 9,562 points.

KSE-100 Index: Closing Above 200-DMA With Low Volume Suggests Pullback To Continue

The Keystone for May 27, 2010

First support 9,357 points, second support 9,264 points; first resistance 9,508 points, second resistance 9,601 points

Analysis and Overview:

The index opened flat and after touching its day's low, took to a steady uptrend to close well positive. Volumes declined by 19.43% and stood at 109.13 mln. The index managed to close above the 200-DMA however volumes were low. This suggests that the pullback is likely to continue.

The Stochastic Oscillator on the daily chart has generated a weak buy signal while the RSI on the daily chart has shown improvement. On the other hand, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart. Also the 30-DMA has cut the 50-DMA from above with the latter now conforming to a downtrend as well. This confirms the view that though there is a short-term pullback likely, the overall trend remains bearish.

The first support is at 9,563 points and the second support is at 9,491 points. The first resistance is at 9,667 points and the second resistance is at 9,764 points.

KSE-100 Index: Closing Below 200-DMA And YTD Low With Volumes Suggests Further Downside Risk

The Keystone for May 26, 2010

First support 9,357 points, second support 9,264 points; first resistance 9,508 points, second resistance 9,601 points

Analysis and Overview:

The index opened on a negative note and after touching its day's high, took to a downtrend to close significantly negative. The index maintained its downtrend and took resistance from its former support trendline and closed below the 200-DMA with volumes almost double; up by 96.69% standing at 135.44 mln. Moreover the index closed at its lowest level for the present calendar year (4th January, 2010 index's closing was 9,438 points). This is bearish and suggests further downside risk.

The Stochastic Oscillator and RSI on the daily chart though oversold are in a failure swing, while on the weekly and monthly chart maintain their respective sell signals. Moreover, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart. Also the 30-DMA is on the verge of cutting the 50-DMA from above with the latter now conforming to a downtrend as well.

The first support is at 9,357 points and the second support is at 9,264 points. The first resistance is at 9,508 points and the second resistance is at 9,601 points.

KSE-100 Index: 200-DMA Could Create Support In The Short-Term

The Keystone for May 25, 2010

First support 9,623 points, second support 9,516 points; first resistance 9,743 points, second resistance 9,830 points

The index opened flat and remained under pressure throughout the session to close well into the red. Volumes declined marginally by 1.43% and stood at 73.67 mln. The index maintained its downtrend and registered a lower high and a lower low.

The Stochastic Oscillator on the daily though oversold is in a failure swing, while on the weekly and monthly chart maintains its sell signal. Moreover the RSI on the daily chart has now become oversold. However, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart.

However the only redeeming factor is that the index's 200-DMA looms below, which could potentially create support in the short-term.

The first support is at 9,623 points and the second support is at 9,516 points. The first resistance is at 9,743 points and the second resistance is at 9,830 points.

KSE-100 Index: Closing Below Former Double-Top And 100-DMA A Bearish Signal

The Keystone for May 24, 2010

First support 9,809 points, second support 9,716 points; first resistance 9,901 points, second resistance 9,960 points

The index opened on a negative note and remained under pressure throughout the session to close in the red. Volumes increased by 12.70% and stood at 74.73 mln. The index registered a lower high and a lower low, while giving a sustained closing below the 100-DMA. Moreover it closed below its former double-top at 9,978 points. this was the level from where the index had staged a strong rally towards 10,736 points. This further adds credence to the bearish view.

The Stochastic Oscillator on the daily chart maintains its sell signal, which coupled with the weekly and monthly Stochastic Oscillator maintaining sell signals, is a bearish signal. Moreover the RSI on the daily chart has once again started to show weakness, while on the weekly chart it has broken below its support trendline Also, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart.

The first support is at 9,809 points and the second support is at 9,716 points. The first resistance is at 9,901 points and the second resistance is at 9,960 points.

KSE-100 Index: Closing Below 100-DMA Suggests Further Pressure; Indicators Remain Bearish

The Keystone for May 21, 2010

First support 9,919 points, second support 9,825 points; first resistance 10,050 points, second resistance 10,108 points

Analysis and Overview:

The index opened on a negative note, however after touching its day's high it took to a downtrend to close in the red. Volumes declined by 43.94% and stood at 66.31 mln. Although the index registered a higher low, it failed to sustain above the 100-DMA. This is bearish and suggests further downside risk. Moreover the overall trend remains bearish as the 30-DMA has taken to a downtrend and could cut the 50-DMA from above in the near term.

The Stochastic Oscillator on the daily chart maintains its sell signal, which coupled with the weekly and monthly Stochastic Oscillator maintaining sell signals is a bearish signal. Moreover the RSI has once again started to show weakness. Also, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart.

The first support is at 9,919 points and the second support is at 9,825 points. The first resistance is at 10,050 points and the second resistance is at 10,108 points.

KSE-100 Index: Formation Suggests Short-Term Pullback To Continue

The Keystone for May 20, 2010

First support 9,999 points, second support 9,916 points; first resistance 10,105 points, second resistance 10,175 points

The index opened marginally negative and after touching its day's low it recovered to turn positive only to close in the red. Volumes were up by 39.39% and stood at 118.28 mln. The index has created a long lower shadow which suggests that the pullback is likely to continue. The overall trend remains bearish as the 30-DMA has taken to a downtrend and could cut the 50-DMA from above in the near term.

The Stochastic Oscillator on the daily chart maintains its sell signal, which coupled with the weekly and monthly Stochastic Oscillator maintaining sell signals is a bearish signal. However the RSI has shown some improvement from close to its oversold region. Also, the MACD maintains its downtrend as well as its sell signal on the daily and weekly chart.

The first support is at 9,999 points and the second support is at 9,916 points. The first resistance is at 10,105 points and the second resistance is at 10,175 points.