Stock call (follow up 1) .egx30 ((( if history tends to repeat itself, then .. the index is looking for a bottom ))) nov 17, 2011
STOCK CALL JAZIRA SECURITIES BROKERAGE FOLLOW UP (1) Thursday, November 17, 2011EGX30 RIC: .EGX30IF HISTORY TENDS TO REPEAT ITSELF, THEN “THE INDEX IS LOOKING FOR A BOTTOM”It’s our job to search for repetitive patterns in the charts. Who lied to you and told you thatTA is all about H&S and trend lines? Technical Analysis building stone concept is that;“History tends to repeat Itself over and over”. Of course, Recurring patterns may not beidentical, but knowing that a certain manifestation is being repeated will make a difference.In our unstoppable search, we found something and would love to share with you.Relative Strength Index (RSI):Taking out the Red Resistance Line in 2009 was the first REAL signal of a rally that forcedthe market to nearly 7,700. A thrust up over this line, which gave a Negative Reversal sig-nal (see green lines in both chart and RSI), has followed by a thrust down to the rising dot-ted brown line, slightly over the red Bear Support Line. The RSI, before any other tools,has signaled a beginning of a rally just at a bottom. We have, so far, a nearly similar pat-tern; triangle, multiple divergences, a thrust up over a red declining line, Negative Reversalsignal and a thrust down to a confluence of support from the apex of the triangle. Shouldhistory repeats itself, the RSI will find support somewhere over the 20 level, and willbounce strongly giving an early signal of a BOTTOM. The Negative Reversal Signal mayforce the index to the 4,000 level (a measured target of the NG signal), the Oct low, oreven slightly lower. But as long as the RSI lies over both the rising dotted brown line andthe red Bear Support Line, I don’t care where the market will hold its breath, because, giv-en this recurring pattern, it will do that in the near future. The RSI is making me bullishand only a decline to below the 20 level in the RSI will make be completely bearish.MACD:Do you know that the MACD is giving its second strong Positive Divergence signal since2009 bottom ???!!!The indicator, since 2008 top till now, is moving in just two channels. A breakout over thefirst channel took place at mid December 2008, months before the bottom in the price itself(see the first green rectangle). The MACD has built a double bottom, successfully penetrat-ed its neckline, found an obstacle near the declining dotted red line and is currently pullingback to a SZ. Taking out this line offers a very important conservative Buy signal. BOTTOM LINE: (Last Price: 4,170 pt. Cls Nov 16) ACCUMULATE and/or BUY a breakout over the MACD trend line 1
STOCK CALL JAZIRA SECURITIES BROKERAGE FOLLOW UP (1) Thursday, November 17, 2011 Jazira Securities Brokerage Jazira Securities Online Trading 15 Shooting Club Street, Mohandessin You can trade online through Jazira Securities online Tel: (+202) 3760 9983 - 37609941 trading portal ... Fax: (+202) 3760 9883 www.jaziracapital.com Please contact our customer Service representatives for further information..JSB Contacts Title Land Line Mobile EmailHussein El Sawalhy, CFA Managing Director +202 2578 0931/2 +20100 1410 690 email@example.comAhmed Helmy Head of Sales & Trading +202 2576 0188 +20100 1004 482 firstname.lastname@example.orgMohamed Fahmy Head of Research +202 2578 0931/2 +20122 2157 312 email@example.comRamy Rashad, CMT Senior Technical Analyst +202 2578 09 31/2 +20100 8385 501 firstname.lastname@example.orgBasant Soror Online Trading Technical Support +202 2578 09 31/2 +20122 1615 409 email@example.comGeorge Mansour Customer Service +202 2578 09 30 +20122 9214 069 firstname.lastname@example.orgDoaa Osman Customer Service +202 2578 09 30 +20122 7552 436 email@example.com Disclaimer Jazira Securities Brokerage (JSB) is a licensed Egyptian Stock Market Broker, regulated by the Egyptian Financial Service Authority. Opinions, estimates and projections contained in the research reports or documents are of the author as of the date published and are subject to change without notice JSB research reports or documents are not, and are not to be construed as, an offer to sell or solicitation of an offer to buy any securities. Unless otherwise noted, all JSB research reports and documents provide information of a general nature and do not address the circumstances of any particular investor. Neither JSB nor its mother company (Jazira Capital), or any of its affiliates accept liability whatsoever for any investment loss arising from any use of the research reports or their contents. The information and opinions contained in JSB research reports or documents have been compiled or arrived at from sources believed reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness. JSB, Jazira Capital or any of its affiliates and/or their respective officers, directors or employees may from time to time acquire, hold or sell securities mentioned herein as principal or agent. JSB research reports and all the information opinions and conclusions contained in them are protected by copyright. The research reports or documents may not be reproduced or distributed in whole or in part without express consent of JSB Research. JSB research reports or documents, recommendations and information are subject to change without further notice . 2
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