Gulf stock markets set to test chart resistances
Major Middle Eastern stock markets may approach or test technical resistances on Tuesday after strong trading volumes in the previous session showed buyers were returning to the bourses.
Benchmark Brent crude surged 5.1 percent to $34.69 a barrel overnight, although it has retreated slightly in Asian trade on Tuesday morning. The Dow Jones industrial average climbed 1.39 percent.
These movements contribute to a feeling that oil prices may at least have bottomed and that the global equities market environment is improving, which may continue to buoy Middle East stocks on Tuesday – possibly setting the markets up to break the chart barriers in coming days.
The Saudi stock index, which last closed at 5,978 points, faces resistance at the February and January peaks of 6,056-6,098 points. Any clean break would signal the market has bottomed for the medium term at least.
Dubai’s index, last at 3,170 points, faces resistance on the late December peak of 3,189 points. Any clean break – two straight daily closes – would trigger a reverse head & shoulders pattern formed by the highs and lows since December and pointing sharply higher.
Egypt’s index, which on Monday gained 1.3 percent to 6,086 points, faces slightly more distant resistance, the February peak of 6,261 points.