The NSE ASI rallied 172.25points today on the Fed’s promise to keep interest rates at the present low level all the way to 2013.
| Ticker | Date/Time |
Previous |
Price |
%Change |
YTD |
| NSE |
26/01/2012 |
20625.56 |
20797.81 |
0.84 |
0.32 |
| NSE 30 |
26/01/2012 |
923.18 |
930.96 |
0.84 |
0.78 |
| NSE BANKING |
26/01/2012 |
263.02 |
265.33 |
0.88 |
-3.26 |
| NSE F&B |
26/01/2012 |
1675.51 |
1681.62 |
0.36 |
185.21 |
| NSE INS |
26/01/2012 |
124.35 |
123.6 |
-0.60 |
-13.89 |
| NSE O&G |
26/01/2012 |
225.47 |
225.47 |
0 |
2.44 |
| Date : Thursday, January 26, 2012 | |
| Market State : Closed | |
| Index : |
20,797.81 |
| Deals : | 2,701 |
| Volume : | 196,975,536 |
| Value : | N 2,186,415,844.51 |
| Cap. : | N6,554,516,088,113.72 |
Fundamentals
Investors were greeted with news that Firstbank is likely to pay N1.00 dividend for the fiscal year the reality of the news soon set in and spurred bargain hunters to step in, lifting the market all the way to its close. I
ndeed, investors have been worried about recent troubles (which I termed Fuel Subsidy rally/Boko Haram rally) but this current info really took that concern away and gave the bulls some reason to celebrate.
However, that didn’t stop some investors from selling on the strength as it is still a scared market. The sense of the market being short term oversold is also overwhelming in the market and it would not be strange to see a couple of days of dead cat bounce from here.
Yes, the cat remains dead until something significant changes in the fundamentals of the economy, which remains extremely weak right now. Yes, we are in a news/events driven market now and every new development on the significant issues will change the outlook of the market. Such is the kind of market to be investing for the long term on significant retreats.
Technicals
Today’s follow up is indeed a good get out time for short term traders who has yet to cut loss.
Why?
Because even though today’s rally was a significant one under normal market condition,spurred by Firstbank info, we still saw profit taking within its peer groups (GTB & Zenithbank),despite huge volumes traded.
So far the NSE ASI needs 274+ points to hit its last resistant levels of 21,072 of 17th January 2012, this is the area where we test how healthy this current Bull is.
Unless the market follow up with a significant rally beating the last high of 21072+ points, today’s rally means nothing.
Even if tomorrow ends up positive, it could still be a short term dead cat bounce that does nothing more than create a week or so of excitement before turning back down lower. As such, any strength remains a good time for getting out of longs so that you can wait out the uncertainty. Until something significant changes in the economy and the charts.
For now its time to start looking your TA Signals for resistant levels.
TA SIGNALS FOR JANUARY 26 2012
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