Research houses ask the investors for a cautious approach due to overbought state

The northbound journey remained unabated and added another 737.33 points to the score taking, Kse‐100 index to 53,860.36. We remain positive in the near term until a clear price signal emerges to hint initiation of a countertrend move.

Immediate continuation of current bullish run is targeting 53,930 – 54,093 area, with support placed in at 53,255. A break above 54,093 would eye 54,222 – 54,450 points. Immediate support stands in b/w 53,719 – 53,550, while relapse under 53,550 would instil weakness towards 53,400 – 53,255 points.

Considering the momentum indicator, the Stochastic Oscillator and RSI on daily charts is in highly overbought state and need to cool down, hence warranting a cautious approach. Amid an overbought condition, volatility in the market is likely to remain high. Anticipating further upward move in a cautious way, we elevate risk level for the index to 52,900 targeting 53,930 – 54,093 and later 54,222 – 54,450.

Courtesy – AHL Technical

Posted in PSX.

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