Activity levels on the Dubai Financial Market General Index (DFMGI) were very low last week, with volume falling close to the lowest level of the year. The DFMGI closed at 1,451.87, down 18.58 or 1.26 per cent for the week. Market breadth was bearish with 21 declining issues and only eight advancing.
Last week the DFMGI closed below support of five of the prior six weeks. It remains to be seen whether any real technical damage was done. Closing below the lows of prior weeks indicates that selling pressure dominated and now a re-test of the recent 1,425.34 low is more likely than it has been. Also, the DFMGI could break below that price level. If it does so, the next price areas to watch for support are around 1,397.71, and then 1,352. The swing low of 1,338.56 from the sell-off in March of 2011 is an even more significant potential support area given its importance at the time.
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