Elixir Securities Limited – Elixir Grid
Karachi, January 01, 2018 (PPI-OT): International Steels: Descending Resistance in Play
ISL has pulled back sharply after a nosedive to 86 level. The price action is currently testing the descending resistance at 108.50 as visible on daily charts. Although we have seen significance bounce the bearish resumption scenario remains possible, as price could be completing a retest of resistance line ahead of moving back lower, where holding below 92.60 is necessary for this scenario to remain valid.
For now though, the rising thrust has put the short-term momentum indicators in overbought zone which augments the possibility of near term correction from the descending resistance at 108.50. On downside, immediate support is placed at 101.80 while a break below this would target 99.90 (38.2% Fib of 86/ 108.5 ascend) and 97.25 (50% Fib of 86/ 108.5 ascend) as major areas of interest. A larger correction could however last till 94.60 and 92.60 before the stock resumes its ascend.
On upside, succeeding a break above 108.50 would be a sign of termination of the current bearish structure with 117/118levels in sight at the first attempt while a break above thiswould put the stock on a higher climb to the levels124/126.