News Column

UAE markets in the balance

May 25, 2014

Andy Staples Editor — Universal Copy Desk

Dubai: Market experts and traders will be keen to see how the UAE stock exchanges react to last week's correction following the long public holiday weekend.

When trading closed last Thursday, the Dubai Financial Market had seemingly checked a sharp fall in prices. Having lost 13 per cent of its value on the five days previous days, Wednesday saw a rally, with a gain of 4.18 per cent. But Thursday's trading was weak, with a gain of just 0.28 per cent. Abu Dhabi, which lost less, fared better, finishing Thursday with a 1.95 per cent gain at 4,864.03.

The market is now wavering between what technical analysts call support and resistance levels — natural points at which traders will buy cheap shares, driving shares prices up again (support), or sell, bringing them down (resistance). Breaking support or resistance is thought to herald new targets, high or low.

Osama Al Ashri, a member of the UK'sSociety of Technical Analysts, said on Thursday that the DFM must break resistance at 5,080 to see a new target of 5,780 in the next few weeks. Breaking resistance would require a price gain of 4.4 per cent.

Fellow technical analyst Mohammad Al Saadi on Wednesday calculated the DFM's support at 4,544, 6.6 per cent below the current level.

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Source: Gulf News (United Arab Emirates)

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