Technical Forecast for First week of JUNE, 2009

By Khalid Saifuddin
May, 31st, 2009 6:00 pm
Technical Outlook:
Market moving in Bullish direction
Finally market achieved Bullish trend, though we had couple of uneven moves in past week, but market never got out of its mild bullish channel. I know few major scripts are still in Bearish trend, but these scripts will eventually follow the market trend.
Monday closing above 7287 will energize the trend, this week I see market bullish channel between 7277 and 7577.
Most of the indicator supporting the bullish trend, but some of the cycles indicating market may test its support before bouncing back.

Low range is still an issue for market; traders need to be preparing for more volatility this week. We lost 4.1 million USD from foreign investor portfolio which may provide the chance for dip in this week, buyers on dip will be the major gainers for this week.

Expected Impacts on market this week:
GST may be raised to 17%.
Electricity tariffs to be raised; subsidy to end in FY09.
SC allows Sharif brothers to contest elections.
Real estate and service sector to be taxed, government plans to increase the tax community.
IMF delayed its third tranche of US$850mn by a month due to non-settlement of key budgetary measures.

KEY Levels
Resistance
7304 - 7317
7438 - 7445
7586
7696
8028
Support
7244
7167 - 7176
7105 - 7129
7028 - 7056
6975 - 6996
Recommendations: I strongly recommend buy in most of the scripts on dips, most of the buying in this week will profit above expectation, I suggest keep buying around support levels and hold.

Recap: KSE-100 for Past week

Last week I mentioned that if market closed on Monday between 7166 and 7175 then it will establish the bullish trend, and Monday the 25th, May market closed at 7173.
As I said in my Past week forecast market will be having low volatility, we experienced only 242 points move in whole week. Market gained 130 points this week.
Pre-budget measure was the key concerns for the market, market sustained the bomb blasts in different cities; SC decision was a positive impact on market. Market was precisely observing the military operation in northern areas.

Disclaimer
This report is prepared solely for information and data purposes. The above is not recommendation to buy or sell. We accept no liability whatsoever for any loss arising from any use of these levels. However the author DOES NOT GUARANTEES the accuracy of information provided on this report and is NOT RESPONSIBLE FOR ANY ERRORS AND/OR OMISSIONS.