Karachi, May 16, 2022 (PPI-OT): KSE-100: High volatility is expected

The index opened with a slightly positive note and underwent a bullish session. The local bourse posted an intraday high of 607pts, a low of 45pts and concluded with a gain of 588pts to settle at 43,486pts level. A sharp recovery witnessed from an oversold region in the last trading session. Bollinger Bands are 89.04% wider than normal. The large width of the bands suggest high volatility as compared to the normal range of the index. Therefore, the probability of volatility decreasing and the index entering (or remaining in) a trading range has increased for the near-term.

The chart formation depicts that the index may find initial support near 43,150. A break below mentioned support can result into further weakness towards 42,700 and 42,300pts level. Alternatively, the index can face resistance near 43,800pts initially and then head towards 44,100 and 44,400 area. It is recommended to trade with a cautious approach and use stop loss during intra day trading.