TRADERS WATCH 18

The nation’s equity market in the first trading week of the last quarter of the year recorded a mixed performance. It however succumbed to the downward pull, as all the sectorial indexes looked down, apparently not minding the earnings season that started last week with early fliers from the financial and manufacturing sectors releasing their numbers. 

It may not be out of place to imagine that investors are conscious of not celebrating just yet, preferring to tarry awhile, until the peak of the season around the third week of the month. At that time, were up to 20 earnings reports will be hitting the market within a short time, including the major ones would have been made available.

Specifically, the Composite index NSEASI shed 500.18 points to close last week at 27,835.22 points, from an opening figure of 28,335.40 points, representing a 1.77% decline on a relatively improved volume of trades. This signals mixed sentiments on portfolio repositioning by traders and investors ahead of Q3 earnings season regardless of expected weak corporate profit as a result negative macroeconomic factors. Selling volume of total transactions for the week was 96%, while buying position was 4% to reverse the previous week’s bull transition.  

NSEASI WEEKLY TIME FRAME

The NSEASI on a weekly time frame has up trended to form a symmetrical triangle with index trying to break out to confirm continuation of trend as the strength of the trend and direction are increasing as ADX is above 20. The index is trading above the 50-Day moving average, still supporting bull transition. This is a signal that the market has a possibility of providing follow through as we enter into a new week of trade. 

Traders should watch out for first and second resistance level at 28,263.02 and 28,875.74 respectively, and any move down with first support level at 27,450.91 and second support at 27,271.24.

Looking at technical indicators, the NSEASI closed above the lower band by 39.7%, while MACD is bearish. RSI is reading 50.99, which is relatively strong. Money flow index has reversed up, indicating that funds are entering the market. MACD and CCI are signaling EXIT position while SO and RSI are saying buy. 

FCMB

FCMB moved 8.41% higher over the past week on a positive sentiment to signal reversal of down trend that has lasted for almost two years. The price action is still trading below its 20 and 50-Day moving average at N1.16. 

Traders should watch for a breakout of the descending triangle chart pattern to continue the trendto a first resistant level of N1.25 and second resistant price of N1.50 or reverse down to first support level at N1.07 and second support price SS at N1.03 respectively. The strength of the current trend and direction is rising at ADX 20.23.

Looking at the technical indicators, FCMB closed above the lower band by 30.8%. MACD is bearish and RSI is relatively neutral at 45.22, which signifies recovery from oversold region. All momentum indicators are signaling buy, except MACD. MFI is strongly looking up, indicating that fundsare entering the stock. The weekly buy volume of the total transactions was 71%, while sell position was 29%. Also, Friday's position was 75% buy and 25% sell volume.

AFRICA PRUDENTIAL

Afriprud moved 4.81% higher over the past week on a mixed sentiment to continue its up trend move after its double bottom chart formation that supported the current trend.  The move is still weak as momentum is below 20 as ADX is 13.55.  Traders should watch for a break out of the yellow trend line to first resistance level of N3.02 and second resistance level of N3.10 or reverse down to touch first support level at N2.60 and the second support level will be at N2.48 per share. The stock is trading below its 50-Day moving average at N2.83 per share.  The descending triangle chart pattern of the price action equally support continuation of trend. 

Looking at the technical indicators, Afriprud closed above the lower band by 42.6%. MACD is still bearish, RSI is reading 51.32.  SO and CC1 indicators are signaling buy, except for MACD. MFI is just turning up to indicate that funds are entering the stock. The Buy to sell volume indicator reveal 100% buy volume on the week and as at last trading day.

ZENITH BANK

Zenith Bank moved 6.44% lower over the past week on a negative sentiment of 99% sell position and 1% buy volume. The price action has formed symmetrical triangle chart pattern that indicates continuation or reversal of trend. The stock is currently trading below its 20 and 50-day moving average.  The current trend is weak at ADX of 17.02

Traders should watch for a breakdown of the symmetrical triangle chart pattern to continue a downtrend to a strong support level of N13.85 or reverse up to first resistant level at N15.30 each. 

Looking at the technical indicators,Zenith Bank closed above the lower band by 7.8%. MACD is bearish, but just crossed below its signal line two trading sessions ago.  RSI is reading 45.88 which signifies neutral. RSI, SO and CCI are indicating buy, just as MFI turn up to indicate that funds are entering into the stock. Last Friday selling volume was 96% while buying was just 4%.

UNITED CAPITAL

Ucap moved 7.26% higher over the past week on a mixed sentiment to breakout of the symmetrical triangle chart pattern but had a pullback on sell off by traders that are taking profit from the three day trading.

Traders should watch for a break out of the strong resistance yellow line at N2.70 and second resistance of N2.84 or reverse down to first support level at N2.34 and second resistance S2 at N2.14 respectively. The stock is trading above its 20-Day moving average at N2.51 per share.  The ongoing trend and direction is strong at ADX of 46.87

Looking at the technical indicators, Ucap closed below the upper band by 19%. MACD is bearish and RSI is reading 62.48, which signifies strength. All momentum indicators are signaling buy, except SO saying sell. MFI is seriously looking up, indicating that funds are still entering the stock.  The weekly buy volume of the total transactions was 50%, while sell position was 50%. But Friday's position was 100% sell and 0% buy.

OKOMU OIL

Okomu Oil rose 5.55% over the past week on a positive sentiment ahead the expected Q3 earnings report to form a saucer chart pattern in recent time with strong trend and direction of ADX at 40.67.

Traders should watch the uptrend as it has broken the first resistant level at N38, A break out the current resistance level of N48 is high.Any move down to the first support level of N36. The stock is trading above its 20 and 50 day moving average.

Looking at technical indicators,Okomu closed below the upper band by 0.7%. This, combined with the steep uptrend, suggests that the upward trend in prices has a good chance of continuing.  However, a short-term pull-back inside the bands is likely. MACD has been bullish for almost a month at overbought range. RSI is reading 77.94 on overbought region, while other momentum indicators like RSI, SO and CCI are in their overbought range, signaling sell. MFI is looking up, to indicate that funds are entering  the stock with buying volume position of 100%  and sell position of 0% for the week.

All Rights Reserved © Investdata Nig Ltd 2016  
Ambrose Omordion
+2348032055467