NGXASI: NGX All-Share
The NGX All Shares continues to trade above the moving average, closing at 196908.73 basis points, an indication that the market is still strong. However, market players must understand that price is within the distribution stage and close to the resistance level.
On the lower time frame, the market started bullish and stayed above the moving average, while MFI moved from 48.8 to 47.7, a signal to investors and traders that profit-taking still prevails. How did other sectors react to this sentiment?
Market Performance Per Sector
NGXBNK: Bank Sector
The NGXBNK index traded and closed below the moving average at 1861.41. This index price also broke the sector’s strong support level at 1868.17. The price action indicates profit-taking and calls for another support level at 1793.17, as shown in the image below.
Volume is low as the Bollinger bands flatten. Also, MFI is currently at 48.16, and RSI is trading below the overbought region in the daily time frame. Despite the positive outlook on the lower time frame, sellers maintained their position to trade below the market’s support level
NGXCSMG: Consumer Goods Sector
The consumer goods sector completes its double-top pattern formation, closing at 5487.02. The candlestick pattern indicates a potential bear rally for this sector. Since the market hasn’t broken the support level at 5463.29, market players can observe for another bull surge at the current support level.
Looking at the lower time frames, traders can see the low volume in the market. This price action also translates to the volume action in other time frames. Low volume means low liquidity in the market. During this period, market players will wait for more price action before taking a position.
NGXIND: Industrial Sector
While other sectors struggle to gain momentum, the industrial sector continues to dominate above its former resistance level at 7604.27. Currently, the sector price is at 7796.15 above the moving average.
Volume, RSI, and MFI are indicating a strong bull sentiment in this sector. However, MACD continues to lag in the 4-hour and daily timeframes. Following this sentiment, investors and traders should look out for a potential resistance level at 7900.76.
NGXOGSE: Oil and Gas Sector
Unlike the industrial sector, the oil and gas sector broke its resistance level and pulled back close to the moving average. Given this price action, the market is in its distribution stage — a perfect time for investors and traders to participate.
This index price traded above the moving average and closed with a bearish candle at 4506.79. Although the price is above the moving average, the MACD crossed below its signal line, signaling a potential bear market. MFI also falls below 50 to indicate profit-taking in the market, while RSI remains high at 90.48. At this level, market players are taking off their position for portfolio reevaluation
NGXINS: Insurance Sector
The insurance sector continues to struggle within the support zone of 1307.89 and 1272.42. Today, the market traded below the moving average and closed at 1279.48. The buying sentiment in the market wasn’t strong enough to signal a potential bull run.
Volume is weak, and MFI is below 50, indicating a continuous bearish price action. Since the price is within the support zone, the sector has the potential to commence a bull rally from 1272.42.
Final Thoughts
The Nigerian bourse remains positive despite massive profit-taking and portfolio reconstruction. The industrial sector had a good impact on the overall performance of the market. The insurance sector still has potential for a bullish run despite trading below the moving average.
