Technical indicators for major Gulf stock markets are diverging, suggesting relative performance patterns among the markets are changing with Saudi Arabia risking a period of underperformance, technical analysts say.
The main Saudi Arabian equities index has rallied 8 percent from its trough in late June to 7,057 points, but since
Aug. 25, it has traded sideways in a range of just 160 points. Chartists say the loss of momentum is a negative signal for the short term at least and believe a pull-back in the next few weeks is increasingly likely.
The Saudi index "is approaching the minor support of 7,000 - any dip below this level means another dive toward 6,800 points," said Mohabeldeen Agena, head of technical analysis at Cairo's Beltone Financial. He expects the market at best to trade flat for the next two or three weeks.
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