Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Tarrified as President Dump Risks Turning Recession into Stagflationary Depression - 21st April 25
President Dump Delivers BEAR MARKET - Stock Market Battles Between Order and Chaos - 7th April 25
Stocks Bull Market End Game Bear Start Strategy - 20th Mar 25
Gold and System Collapse: Charting the Bank Run of the Mighty US Dollar - 20th Mar 25
Tesla's Troubles — Is it Musk or is it More? - 20th Mar 25
The Stock Market Bear / Crash indicator Window - 9th Mar 25
Big US Tech Stocks Fundamentals - 9th Mar 25
No Winners When The Inflation Balloon Pops - 9th Mar 25

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Saudi Stock Market (Tadawul) at pivotal juncture

Stock-Markets / Saudi Arabia Jan 28, 2019 - 03:45 PM GMT

By: MarketsToday

Stock-Markets

As of yesterday’s (Sunday) 8,528.30 trend high, the Tadawul All Share Index (TASI) has rocketed over 12% in 25 trading days, when counting from the swing low of 7,589.23 on December 23. A long-term bullish trend continuation signal was triggered on the move as the day’s close was at 8,509.43, just above the most recent peak of 8,502.92 from July 2018. Further, yesterday’s close was the highest daily closing price since August 2015.


TASI Daily Chart

During the rally, the index broke out of a head and shoulders bottom trend reversal pattern with a complex right shoulder. You can see from the chart below that there was first a breakout of a head & shoulders bottom as price went through the lower neckline in early-December. Then, the formation continued to evolve, creating a second right shoulder. This led to a breakout of the second neckline three weeks ago. Given that yesterday’s high was just barely above the July peak, it remains to be seen if some resistance may still be seen before the TASI continues higher.

This is all very bullish behavior. Nevertheless, the TASI may have gotten ahead of itself and needs to take at least a short rest before moving higher. Given the rapid ascent over the past five weeks and the fact that the index is hitting potentially significant resistance, it seems like there is a good chance for some sideways movement or a pullback before the TASI is ready to sustain upward momentum. Also, the 14-day Relative Strength Index (RSI) momentum oscillator is well overbought at this point.


TASI Weekly Chart

Either way, it would be healthy for the advance if the index took a bit of a rest before progressing. This would also give investors a chance to prepare for the next run, as a continuation of the long-term uptrend that began off the October 2016 low. Regardless, so far there is no sign that the TASI will stall or pullback in a more significant fashion than last week’s relatively sideways movement. Investors should be prepared, nevertheless.

Investors in US markets can get exposure to Saudi equities through at least two ETFs. The iShares MSCI Saudi Arabia ETF (KSA) has almost 100% exposure to the Tadawul, while the Wisdom Tree Middle East Dividend Fund (GULF) has approximately 27% exposure, according to ETF Database.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in