Wema Bank is one of Nigeria’s long-established commercial banks. The bank operates as a commercial bank with national authorisation and has increasingly positioned itself as a digital-led financial institution, with ALAT as a major component of its retail and digital banking strategy.
Current price: N29.20
Rating: Buy
Price projection: N36, N37.50, and N60
Technical Analysis
In this report, we shall use the following tools and analysis methods:
Elliott’s wave theory to understand the overall market sentiment
Fibonacci tools to determine support and resistance levels
The Relative Strength Index and volume to evaluate the market’s strength
The Money Flow Index to determine the market liquidity
Moving average and MACD to understand the nature of the trend
Top-down analysis to know the best investment position
Elliott wave analysis
Weekly chart: Market overview
Wema is within Wave 2 of the super grand cycle, meaning investors should expect a continuous corrective market. Currently, the stock is within its final corrective wave (wave C). Following this wave, investors should expect another bullish rally.
The overall volume is low due to the corrective phase. In line with this performance, MACD sustained its bearish momentum, money flow declined drastically, and momentum remained solid. Since WEMA has good fundamentals, the upside potential is massive.
Daily chart: Investment opportunity
On the daily chart, WEMA Bank shows signs of recovery as MACD remains bullish and liquidity gain momentum. However, the volume remains low. Thus, investors should watch N25 and N26 as possible support levels because the stock remains corrective. Also price projections for WEMA are N36, N37.50, and N60
SWOT Analysis
