NGXASI In Bearish Outing Amidst Positive GDP Ahead Of This Week’s Policy Meeting

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Trend identification is arguably the most crucial concept in technical analysis. While position traders may be able to explain their process in simple terms: “cut losses short, let winners run,” applying these rules requires discipline.

The simplest trend following an investment strategy and sector rotation and is very important to market players when combined with technical analysis tools like market structure and waves.

Also, knowing what is happening in the general economy and identifying current stage, which sectors have done well and will do well, while looking at economic indicators such as interest, inflation, exchange rates and national output i.e GDP so as to know what stage of the economic cycle we are in, is important. This is because it guides trade and investment decision such as sector or industries to position in.

The recent macroeconomic reports like the January consumer price index of 29.9%, GDP figure of 3.46%, high MPR of 18.75%, and the foreign exchange rate at above N1,500/$1 already confirmed that the economy might be at the contraction stage ahead of next week policy meeting.

A higher interest rate as expected will further push the economy into contraction, despite the seeming slow growth recorded so far in the last two years. As a strategic trader looking to capitalise on current market dynamics, watch the indexes and price actions below.

NGXASI Weekly Chart (Opening Chart)

NGX Banking Weekly Chart