ASI Weekly Report - Highest weekly increase for 2019

CSE All share Index closed higher for the 4th week in a row, breaking another record with the highest weekly increase of 228 points from a low of 5656 to a high of 5884 points. Number of trades too were the highest for the Year in an up-trending market. Weekly trades were 43,154 over the previous weeks number of 30,418.

There were 29 Counters with 300+ trades, whilst 15 of them were 500+, and 3 Counters had trades over 1000. Incidentally AEL topped the list with 1942 trades.

Along the way the ASI broke the major levels of 5800, and 5850 with strength.


Obviously the Market is on fire. The Bulls aren't leaving any room for the Bears to take control. On the last 3 days of the week we saw moments of Bear Power, but the Bulls wiped them out of sight. Can the Bulls take away the 5900 and 6000 points by next week?

Hourly RSI is in the overbought area just like in the Daily Chart, but there had been pull backs testing the 48 point area to extend the trend again with much vigour.

It is natural for any one who watches the Market behaviour to expect a correction, but the bullish sentiments prevailing in the market makes that expectation to move in to the back seat.

The biggest and the most important fundamental event is certainly the falling Deposit and Lending Rates. But we can not turn our faces back to the biggest driver of sentiments of the Sri Lankan Population i.e. the Politics in the midst of the Presidential election. This has found its way into the Market where Traders having different political views are siding with Bulls and Bears in the Market. As such they are risking millions based on their own theories.

This has made the investment decisions of Investors who base their investments of lowering rates and better Corporate performances, to mop up some sizes of their positions too.

Experience have shown that any euphoric behaviour needs a cooling off. Therefore both traders and investors in my opinion must follow a Buy on Dips Strategy, only if they believe that the overall market is in an upward trajectory with dips or sideway movements or consolidations or what ever you call it. It is always profitable to stick with profitable counters with strong fundamentals. But need to always remember that Stock Prices fall for reasons beyond your control. Therefore be humble enough to cut loss base on your level of risk.