Dubai Last week the Dubai Financial Market General Index (DFMGI) declined by 7.76 or 0.46 per cent to close at 1,678.74. Volume declined to the lowest level of the past ten weeks, while market breadth was leaning bearish with 11 advancing issues and 20 declining. From a technical perspective nothing has really changed in the DFMGI. For the past five weeks the index has been trading in a narrowing sideways price range with a slight upward bias (upward sloping angle across bottom). A small symmetrical triangle consolidation pattern has now formed in the daily chart, indicating that the DFMGI is likely to either breakout higher or lower from the range within the coming week or so. The first sign of a break-out higher is on trade above 1,706.60. Further confirmation of strength is given above 1,729.51. However, it remains to be seen whether an upside breakout will have enough momentum to take the index above the recent high, and top of the 12-week uptrend, at 1,778.25. Keep in mind that price consolidation breakouts can always fail to follow-through in the direction of the breakout, or evolve into a larger consolidation pattern. Price momentum post breakout can help determine the strength of the trend at that point and therefore its sustainability. A decisive move above 1,778.25 will give a trend continuation signal with the odds then increasing that the index will trend higher from there. The DFMGI next targets resistance around 1,793.10, followed by 1,850 up to 1,887. For the past eight weeks the DFMGI has remained above a long-term trend line, even after a price correction lower (1,591.84 support). That correction completed a 38.2 per cent Fibonacci retracement of the 12-week uptrend with the index finding support from buyers right at the trend line before bouncing. This type of price behaviour relative to pattern structure is reflective of underlying bullish sentiment. In other words, a medium-term bullish bias remains. Fibonacci ratio analysis is a methodology used to find potential support or resistance relative to the prior trend. In this case of a retracement lower from a prior uptrend. Weakening in the short-term is first indicated on a break below 1,652.18, and confirmed below 1,637.41. At that point the DFMGI would target 1,591.84 support, the recent swing low, along with the long-term trend line, now at approximately 1,570. If the index then continues to fall from there watch for support around 1,535. The Abu Dhabi Securities Exchange General Index (ADI) had a decline of 35.88 or 1.4 per cent last week and closed at 2,523.10. Market breadth was about even with 15 advancing issues and 18 declining. Even though volume did rise a little above the prior two weeks, it was not so significant to indicate significant selling pressure coming into the market. At least not yet. What is important though for the near-term is that the ADI closed below the lows of the prior six weeks, closed near the low of the week\'s high to low range, triggered a breakdown (below 2,535.67) of a bearish double top trend reversal pattern, and closed below the 200 daily exponential moving average (ema), a long-term trend indicator. Such bearish price behaviour signals an increased likelihood that the ADI will fall further as it retraces the pior uptrend, before finding significant support that can turn it up again for a second leg of the rally. In technical analysis, when two pieces of analysis identify a similar price support or resistance level, the significance of that level is increased. For the ADI a potentially significant zone of support is identified from around 2,429 to 2,426, consisting of the target measured from the double top pattern and a 61.8 per cent Fibonacci retracement support level. It may take a little while for the support zone to be reached and there\'s no certainty that it will be. In the meantime, keep an eye on the 2,509 and 2,472 support areas. At this point a move above last week\'s high at 2,560.79 would indicate short-term strengthening. Abu Dhabi Commercial Bank continues to hold strong in a tight consolidation pattern very close to its recent high at Dh3.36. This stock closed at Dh2.26 last week. A breakout above Dh3.36 will put it at a three-and-a-half year high. It\'s one of the strongest looking stocks in the market on technical basis as it bottomed in early-2010, has been progressing higher in a well structured long-term trend, is up near long-term resistance, and has been above its 200ema since September 2010. Air Arabia broke above its 200ema a couple months ago for the first time since March 2010 and has been consolidating in a tight price pattern along with the market index. It may not be ready to move without the strength of the larger market but deserves to be watched. Ekttitab Holdings has formed a symmetrical triangle pattern on its chart which has the potential of breaking higher in the next one to two weeks. A breakout is signaled above Dh1.49, and a failure on trade below Dh1.21. Emaar Properties broke out of a similar pattern two weeks ago with a bullish pattern continuing to develop. It could be that Emaar is a leading indicator for the broader market. Being a major stock it certainly supports the view that the Dubai market maintains a bullish medium-term outlook.