KSE-100 Index: Formation An Adjustment To Monday's Decline Indicators Maintain Sell Signals

The Keystone for June 30, 2010

First support 9,633 points, second support 9,543 points; First resistance 9,763 points, second resistance 9,843 points

The index opened positive and after touching its day's low, took to an uptrend to close below the high which it set in the initial hours of the day. Volumes were lower by 22.85% and stood at 62.85 mln. The index's formation was more of an adjustment to Monday's decline. The trend remains bearish.

The Stochastic Oscillator on the daily chart maintains its sell signal, while the RSI on the daily chart continues to show weakness after reacting from its resistance trendline. Moreover, the 30-DMA has cut the 200-DMA from above, while the 50-DMA has cut the 100-DMA from above. This is a bearish signal.

Hence Tuesday's formation is a bearish divergence and serves as an adjustment to the overall downtrend and any upside should be capitalized upon to sell.

The first support is at 9,633 points and the second support is at 9,543 points. The first resistance is at 9,763 points and the second resistance is at 9,843 points.