Egypt’s stock market is suffering from a severe decline in purchasing power, in light of the market testing an important support level at 11,100 points.
Mohamed Othman, Head of the Technical Analysis Department at Pharos Holding, said that the selling pressure was clearly disclosed on all market indices in the Egyptian Exchange (EGX).
He said that this confirms the bearish performance of the benchmark index EGX30. He also said that the weakness demonstrated in: the series of lower highs; breaking several support levels; and breaking through its key support level at 11,100 which represents a previous broken peak.
In this regard, breaking below the latter level would pave the way to another drop, where the next support level lies at 10,800 points.
According to the current performance and the absence of the buying power, Othman said that Pharos Holding will keep its conservative viewpoint. Any rebound should be viewed as a good opportunity to reduce positions.
Last week, the EGX30 closed at 10,918.4 points, recording a decline of 3.05%. Meanwhile, the EGX70 EWI posted a 6.07% loss concluding the period at 2,078.53 points, while the S&P index declined by 5.7% and concluded the period at 1,770.72 points.