Elixir Securities Limited – Elixir Grid

Karachi, February 11, 2019 (PPI-OT): KSE100 – Exhaustion around the Falling Resistance

The benchmark KSE100 Index seems to have lost momentum ahead of a major descending resistance at 41,700 level as visible on its daily time frame. Applying Fibonacci retracement to the rally also reveals that the recent intra-day high (41,767) also coincides with 261.8% Fib extension of 36,802 (low of December 31st, 2018) to 38,449 (high of January 02nd, 2019) from 37,374 (low of January 03rd, 2019), adding more to its strength as a potential ceiling.

Bears have clearly been on the driving seat for the last three sessions dragging the Index below the short-term ascending trend-line support at 41,100 on last Friday and challenging a key support at 40,800 level (200 EMA) which nearly lines up with 23.6% fib of 37,374/41,767 larger ascend. If this area keeps the losses in check in near-term the Index could further climb to the levels of 41,100/200. Conversely, a continued decline below 40,800 level would be a sign of further bearish correction to the levels of 40,500 and 40,226 (38.2% fib of 37,374/41,767 larger ascend) next.

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