Tuesday, September 5, 2017

Nigerian Stock Exchange All Share Index Outlook for September 2017



The NSE All Share Index ended the trading month of August on a bearish note with 0.96% decline with YTD stand at 32.11% appreciation  

Trend Analysis
The bullish rally in the NSE All Share index which started in the month of March 2017 continued into the month of July as investors during these periods showed high level of bargaining interest. The bullish forces saw key resistance levels breached to the upside, first was the intermediate resistance of 31,073.30 (seen in June 2016) and later 35,843.40 which was marginally breached in the month of July 2017.

The month of August 2017 saw a further rally in the index to a high of 38,241.7 during the trading month but failed to sustain the momentum as such we saw the index closed below support turned resistance at 37,108.3 with the supply side overpowering the buying side of the market. 

Volume analysis showed traded volume increase consistently from the march 2017 up until June 2017 after which traded volume subsided in the month July despite the bullish close of the index.

Oscillator indicator – RSI 14 month period has thus rallied to the overbought territory and presently in a corrective wave. It stands at 64 

Breath analysis showed negative sentiment as 41 stocks closed negative compared to 35 stocks that ended the month positive.
 

Source: Amibroker Monthly Chart

Price Pattern:  the month of August closed with a reversal pattern (Inverted hammer – shooting star) 

Historically, September has average a negative month for the index, and the coming month is no exception as technical patterns has indicated an impending downtrend.

Expectations
Equities traded on the floor of the Nigerian Stock exchange would most likely witness fall in market value in the coming month as technical indicators had signaled a selloff
 

Search For Posts