General upward bias remains in place for UAE markets | GulfNews.com

General upward bias remains in place for UAE markets | GulfNews.com:



"Last week the Dubai Financial Market General Index (DFMGI) declined by 57.91 or 1.40 per cent to end at 4,088.82. Volume fell to a 16-week low, while market breadth fell to the bearish side, with 31 declining issues and only nine advancing. 




The DFMGI managed to drop to a three-week low early in the week, falling below the 55-day exponential moving average (ema) on a couple of days, but each time closing above it. So, even though there was a short-term bearish signal as the index moved below the 55-day ema, the fact that the day ended above it on each of two days, is short-term bullish. In other words, the 55-day ema is showing that it is holding as support for the index, at least so far.



In addition, the 21-day ema has now converged with the 55-day and is sitting just barely above it, for the first time since around August 2012. This is a confirmation of the decline in volatility as the DFMGI continues to consolidate. At the same time, as price action compresses, what follows is frequently an acceleration in movement."



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