PSO Chart 03rd september 2014

Penetration of more than 50% of dark cloud cover into White body of yesterday. Volumes also increased, suggesting a buying blow off. Today's the chart opened up above the resistance level of 387 but could not maintain it. if, close above the high of today's dark cloud cover, would be considered another bullish rally, otherwise it would be a trend reversal and high of dark cloud cover would be a top.   

Thoughts about -4.5% drop

The karachi stock exchange today crossed a crucial resistance level of 29200. I look back on the day, 11th August 2014, when market just took a plunge into 4.5% drop due to the political crises. a lot of people just sold their stocks expecting a major crash in the market, all fearing the 2008/2009 financial crash to happen anytime soon and very much the things were looking that way too. Everyone just wanted to get out of the market and invest in something which will keep their investment safe. I myself got out of the stocks in july and august as well due to the fears of financial crash but if we look today, the market is standing right there where it took a drop on 11th august, this is the beauty of this market, creates fear, takes everything you have, and makes you regret about it. 

so why is the market is so much stronger now, not what it used to be. I personally think, the foreign participation in the market has really made it a stronger place. the market is no more in control of big fishes who when got panicked, sold their stocks, and individuals started to follow the herd. This market is not what it used to be in 2008 anymore. The net buy/(sell) by FIPI since last june in karachi stock market has been $404,803,388. This is hefty amount of buying that foreigners have done since nawaz sharif government came into power. 

The stock market will take future plunges like these, may be tomorrow, next month, or next year but only people who are in the market just for the sake of investment, will benefit from it. Gone are those days when one would make enough money in day trading. international corporations are now hiring quats into their organisations who comes up with algorithmic trading systems to perform high frequency trading. only a few good day traders can beat them. God knows when they will be coming to Karachi stock exchange, so the best option right now would be to buy good blue chips stocks and hold them at least for 3 months. 

where's kse 100 index moving 02th september 2014

where's kse100 index moving? 1st September 2014

Technically the market should bounce back because double bottoms have also been created on 12th August 2014 and 28th August 2014. Having said that, any disturbance to the investor confidence will result in the chart dated 27th August 2014.  

where's kse 100 index moving? 28th August 2014

Hammer was created on 28th August 2014 which suggest that we might be seeing the bottom of current bearish trend but confirmation will be needed on 29th August 2014.  

wheres kse 100 index moving?

Political Uncertainty and Karachi Stock Exchange

In most developed nations, the markets tend to move with the economic conditions and how well the economy of a particular country is doing but in a developing countries like Pakistan, elements of political and religious factors also influence the markets as much as the economic factors. The ongoing political situation in Pakistan is no different. The karachi stock exchange has shed more than 1700 points from its top of 30639 to close at 28917 on friday 15th August 2014. The sentiments of alot of investors are negative regarding the government handling of the crises but in this current situation, one should remind themselves that fear and panic are two different things, while fear is healthy for the market, panic is deadly. A lot of people would remember when qadri set the stage during ppp time in Islamabad. In a single day, the market lost more than 500 points and only smart investors bought those shares and rest is history. The current on going uncertainty is definitely a very good buying opportunity for everyone. The shares of blue chip companies will get more cheaper and buying them in this current political uncertainty would be the best investment for ages.