ISTANBUL - Turkish stocks closed their best month since 2003, while they may rally further after the benchmark index crossed the 200-day moving average for the first time in almost a year and a half, Finans Invest said.
The index has risen 13 days and fallen eight days this month. The climb above the 200-day moving average coincides with rising above 29,868, the first so-called Fibonacci level representing a 23.6 percent retracement between a low reached on Nov. 20 and high on Oct. 15, 2007, according to Finans Invest analysts and Bloomberg data. "The up trend from the March lows has reasserted itself and we continue to expect new legs in this unfolding rally," the analysts wrote. Any reversal in the move may serve as a "buying opportunity," they wrote.
Fibonacci analysis is based on the theory that prices rise or fall by certain percentages after reaching a high or low. A break above resistance or below support indicates a currency may move to the next level.
The IMKB-100 index is headed for a 25 percent gain this month, the biggest rally since December 2003, as the country neared an agreement with the International Monetary Fund, or IMF, on a loan and the Central Bank cut interest rates to revive growth.
The benchmark index jumped after Tevfik Bilgin, head of the Banking Regulation and Supervision Agency, said Wednesday profits at banks will increase and their balance sheets passed a stress test. In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index.