Back in January 2008, Dubai’s main stock index, DFMGI, was at 6320. Last week it traded at a low of 2991, a loss of over 50%. Investors have been badly hit. After the regulators announced several concessions and guarantees, we saw a smart rebound that lasted exactly two days. Resistance at the 3700 level was tough enough to push it down today by 275 points, or 7.4%. Many investors are worried about how long their pain will last. My view is we are close to, but certainly not finished with testing the lows. Take a look at the chart. dubai-15-oct-2008 I am suggesting a first target at around 2910. If we get there too quickly, the risk increases for going lower still, to 2760. Right now, stay on the sidelines. Even if we bounce in the coming sessions on new buying by Govt backed funds, you will be better-off by waiting for 2910.
Dubai’s main index still weak
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