Sunday, October 02, 2016/Proshare Research

The Diagnosis
Analysis of the market activity in the week ended September 30, 2016 technically revealed a waning optimistic trading pattern as investors reduced exposures in key active sectors.

However, an extensive analysis revealed sustained modest accumulation pattern while investors displayed low risk appetite towards equities, particularly in Oil & Gas, Consumer Goods, Financial Services and Agriculture sectors.

In addition, volume analysis revealed active sell tendency towards DIAMONDBNK, OANDO, CONOIL, STERLNBANK, CADBURYand PZ while investors sustained modest buy postures towards LIVESTOCK, LAWUNION, TRANSCORP, and WEMABANK.

Nonetheless, investors displayed fresh and growing bargain tendency in some active sector(s), particularly in Conglomerates, Construction/Real Estate and Services sector(s). However, we observed fresh and waning sell tendency in Oil & Gas, Consumer Goods, Industrial Goods and Healthcare.

Summarily, the bulls dominated the week, strengthening  the key benchmark index by 88.29 points against 388.63 gain recorded in the previous week to close at 28,335.40- ASI remains battered below its key resistance level at 41,957.50.

In addition, the All Share Index traded within the   range of 28,335.40 (week-high) and 28,236.23 (week-low) to settle at 28,335.40 - above previous week’s high (27,247.11) by 88.29- This indicates sustained bargain sentiments when compared with previous posture. The outlook reveals weak bargain postures.

In the week just ended, market breadth closed negative at 0.82x against 1.38x recorded in the previous week on the back of low risk appetite.

Likely trends in the coming periods: We expect a sustained low bargain pattern as market sentiments appeared mixed while investors had reduced exposure during the week. Meanwhile, the RSI is closer to overbought threshold.



Technically, market sentiments during the bearish week favoured liquid and active stocks of Medium Cap categories in the sector(s) but with stronger positive sentiments in Construction/Real Estate, Services, Conglomerates and ICT sector(s), which further revealed the sector(s) investors patronised in the week. 

On the other hand, it was observed that negative sentiments appeared stronger in, Healthcare, Financial Services, Industrial Goods, Agriculture, Consumer Goods and Oil & Gas



Stock Trend & Direction
We conducted a review of stocks that have sharpened market direction and performance in the week - using technical tools like RSI, MACD, VOLUME, MFI, CANDLESTICK, MOVING AVERAGES, BOLLIGER BANDS and ACCUMULATION & DISTRIBUTION to reveal investors’ sentiments towards the market movers.

THE BIG VOLUME
FCMB experienced low key bargain tendency to close with positive sentiments in the week. The stock recorded +1.90% gain in the week against +5.00% gain recorded in the previous week.

The outlook in the week revealed waning bargain tendency, indicating weak price recovery pattern in the last 2weeks to record +5.05% gain, after 16weeks sell-down of -44.38% experienced between June 22^nd and September 16^th 2016.

In addition, technical indicator (MACD) revealed sustained weak bargain sentiments towards the stock while RSI and CCI revealed falling price momentum. The stock closed neutral in short term but remained bearish in mid-long term periods, indicating sustained but weak presence of bulls towards the stock as revealed by its price moving averages.

Also, we observed a significant growth in bearish volume during the week, indicating active distribution from investors during the week.  

Technical conclusion on sentiments: The stock has low chance, with low reliability to sustained price recovery in the coming session as the stock remain in bargain.  A Cautious Signal! Chart below shows MACD, candlestick, RSI and volume analysis



THE GAINERS
LAWUNION experienced active bargain tendency to close with positive sentiments in the week. The stock recorded +32.70% gain in the week against flat position recorded in the previous week.

The outlook in the week revealed fresh price recovery pattern in the week, following 12 weeks modest sell-down of -8.33% loss, experienced between July 1^st and September 21^st 2016.

In addition, technical indicator (MACD) revealed active and growing bargain tendency towards the stock as RSI and CCI revealed sharp uptrend momentum. The stock closed bullish in short-term but remain neutral in mid-long term periods, indicating active presence of bulls towards the stock as revealed by its price moving averages.

Technical conclusion on sentiments: The stock has moderate chance, with moderate reliability to extend uptrend in the coming session, considering the active demand postures and upper breakout observed in the week. However, the overbought posture of the price may incite sell tendency. A Cautious Signal! Chart below shows MACD, candlestick, RSI and volume analysis



THE LOSERS
CONOIL experienced moderate sell tendency to close with negative sentiments in the week. The stock recorded -15.10% loss in the week against +33.50% gain recorded in the previous week.

The outlook in the week revealed active profit-taking tendency towards the stock in the week, following active 3weeks rally of 106.61% gain experienced between September 2^nd and September 23^rd 2016.

Technical indicator (MACD) revealed active sell-down with a sharp falling pattern in price momentum while the stock closed neutral in short-term but remain bullish in mid-long term periods. This indicates growing presence of the bears towards the stock.

Technical conclusion on sentiments: The stock has moderate chance, with moderate reliability, to sustain the sell sentiments in coming sessions, considering the active sell momentum experienced during the week. A Cautious Signal! Chart below shows MACD, candlestick, RSI and volume Analysis

Click to view Due Diligence and Price Performance trend.

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LAWUNION

CONOIL

FCMB

Disclaimer: The information provided herein is our opinion only. Under no circumstances do any statements here represent a recommendation to buy or sell your stocks or make any kind of an investment. You are responsible for your own due diligence. To summarize, we do not provide recommendations nor do we make any claims or promises that any information here will lead to a profit, loss or any other result. They are for your guidance purpose only.