Dubai: The stock of National Bank of Abu Dhabi (NBAD) has been struggling ever since it lost almost 30 per cent in one-day with an opening price gap in late-March. A gap occurs when the opening price is different from the previous day’s closing price. Since then the stock has been in a slow decline with continuing signs it could still go lower.
The next support area, based on previous monthly support from December 2008, is around Dh7.90. Even though NBAD could bounce before getting that low, that’s where to start looking for indications it might be bottoming. Lower still is long-term support around Dh6.93. That was the prior low from January 2009, where NBAD stopped declining from the impact of the 2008 financial crisis.
The nearest price resistance area is now around Dh8.50. Trade above that price level would be the first minor sign of strength and would need to be surpassed before there were indications NBAD may continue higher.
A more significant sign of improvement would occur on a daily close above Dh9.00. At that point the stock would have a good chance of reaching at least the Dh9.60 resistance level at a minimum, and could very likely reach resistance around Dh9.95, or even higher.
Future price action should be watch closely for any signs that a bottom may have been reached, based on support levels mentioned above, and then for signs of a reversal.
