Hi everyone. For reasons known only to youtube's algo it started suggesting content relating to the UAE stock exchange, and I made “the mistake” of watching a couple (now it's obsessively showing those, of course… lol). Now truth is I love charting and I got curious, so I started playing around with technically analyzing their index. I'd like to share, just for fun and making no recommendations whatsoever, a brief opinion and what I consider the most likely future scenarios for this market.
It's worth noting that available data starts March 30th 2022, not a ton of it around then. Having said that I was impressed with how smooth the auction seems to be, was expecting to see a very gap rich chart, but they seem to have nice market making going on. Volumes look ok as well, and generally speaking it looks like a very tradable market/instrument. One last thing, I'd absolutely love to hear different takes, macro perspectives and whatnot. Those will be really fun to read actually so please share if you got any!
As things stand, I think the probability of a move higher, back into that big range, is the most likely move. I believe it has some more trading to do there before we can see the next expansion.
My Take: Let's start, this is a daily chart with zones of expected resistance marked. They are based on analysis of price structure along with some math I like to use. The two with the golden caps are the strongest medium-term price attractors. That most recent dip set a new all -time low AFAICT, and it looks like it's been in a hurry to reject those prices, at least for now. The second is a zoomed in view for better understanding this swing failure, and the shorter-term attractors we can expect. Again, in my opinion.
Next, I added two volume profiles to see if confluences presented themselves, and they have (good indication for me). The orange/red on the left is of the range this market has been in since March, the blue/grey one on the right is for all available data. Both set for 100 points per row. The most important confluences are marked with red ellipses. Note confluences between marked areas and VP's edge of value, edges of low volume node, and the big profile's VPOC. I didn't mark it as to not add more visual pieces to an already busy chart, but it's worth noting how the two profiles have their lower edge of value around the same prices, that's the most immediate battleground imo.
So now we have a map let's talk general scenarios. The different colors of my squiggles indicate different phases and may be separated by consolidations. I tried to mark where I think such a consolidation is likely to happen, but what I'm trying to say is that these are general trajectories meant to help illustrate my thoughts, and are not necessarily descriptive of the manner in which the market will play such moves out.
Since the most likely move is back to trading the range I'll start with the bullish scenario.
We obviously have a look at the bearish side of things too. Downside targets are calculated prices as there's no available past data.
Again, in the immediate term I think we are mostly likely to see this market trade the 9100-9700 range for a while more, but there was no point in squiggling that one hahaha.
Hope you found this an enjoyable read, as I said at the start I'd love to hear additional takes! Thanks for reading.
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