Cairo-Mubasher: The Egyptian Exchange (EGX) is expected to continue witnessing positive performance on Tuesday after the government decided to delay a much debated capital gains tax, said technical analysts.

The benchmark index EGX30 is likely to test the 9,000 level, amid an emergence of buying powers and robust liquidity, the analysts said.

The EGX30 closed Monday with its biggest gain in 22 months, jumping 6.5% to 8,798.17 points.

Earlier in the day, the government announced that the 10% capital gains tax would be postponed for two years.Traders had previously filed a lawsuit over the tax, arguing that it was deterring potential investors.

Ahmed Ayyad, a technical analyst at Mubasher trade, said that the market reacted positively on Tuesday to the government’s decision to hold off on the tax, which he said was responsible for the sell-offs seen over previous sessions.

Ayyad indicated that the index will resume its upward trend in the coming sessions, breaking through its resistance of 8,830 to 9,000 points.

If the index crosses this area, it will target 9,150 to 9,300 points, the analyst said, adding that the EGX30 currently faces support at 8,260 points.

Mona Hassan, a technical analyst at MubasherTrade, said the benchmark was trading near the lower line of the bearish price channel at 8,260 points, and is expected to continue its rise in the coming sessions.

Translated by Abdul Maguid Aboshahla