KSE-100 Index: Closing Above 200-DMA And Resistance Trendline Suggests Uptrend To Continue

The Keystone for June 18, 2010

First support 9,617 points, second support 9,514 points; First resistance 9,767 points, second resistance 9,860 points

Analysis and Overview:

The index opened on a negative note and after touching its day's low, took to a strong uptrend to close well positive. Volumes increased by 39.32% and stood at 138.42 mln. The index managed to close above the 200-DMA as well as its resistance trendline (purple line), which suggests that the uptrend is to continue. The test is to see whether the index sustains above the 200-DMA and its recent double-top at 9,826 points.

The Stochastic Oscillator on the daily chart maintains its uptrend however is approaching now rapidly approaching the overbought region, while the RSI on the daily chart has also shown improvement. On the other hand, the 30-DMA maintains its downtrend and in the near-term could cut the 200-DMA from above which would be bearish.

The first support is at 9,617 points and the second support is at 9,514 points. The first resistance is at 9,767 points and the second resistance is at 9,860 points