Technical Analysis in the Stock Markets of Pakistan: A Case of Commercial Banks

Mashood Ahmad and Syed Ali ()

MPRA Paper from University Library of Munich, Germany

Abstract: This research report focuses primarily on the profitability of “Technical Trading Rules” in the stock markets of Pakistan using Banking Sector listed in Karachi Stock Exchange as a case study including MCB, UBL, NBP, ABL, BOP, BAFL, Bank-Al-Habib, Bank AL-Faysal, Soneri Bank and Mezzan Bank. The ultimate objective of the study is to demonstrate that financial volatility can be recognized to the heterogeneity of traders with respect to trading strategies they used. Due to the restriction of time, this study considers only six technical trading and one-year data of the sample stocks. The tools include moving average, Bollinger band, Moving Average Convergence Divergence, Relative Strength Index, Money Flow Index and Support and Resistance Level. The Profitability of each trading rule has compared to the passive buy and hold strategy. Based on the profitability of these rules, Ranks has also assigned to each strategy that generate good profit. With the help of this research and the past strategies that had done on technical analysis, an ample evidences have proved that the technical analysis can be profitable in the stock markets. This research also includes and point out the stocks on which the analyzed tools are not appropriate or using them cause losses. This research has formulated all the calculation for average return and average profits, means researcher does not want the readers to expect strategies for high returns and profits behind this research. This study also presents some evidences of the role played by Big Investors in financial price determination.

Keywords: Technical; Analysis.; Stock; Market.; Commercial; Banks (search for similar items in EconPapers)
JEL-codes: G0 G1 G14 G2 G21 (search for similar items in EconPapers)
Date: 2008-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/64521/1/MPRA_paper_64521.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/116324/1/MPRA_paper_64521.pdf revised version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:64521

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().