12 January Daily technical trader
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12 January Daily technical trader Presentation Transcript

  • 1. TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove Al Rayan Islamic Index: Short-Term – Upmove Qatar Islamic Bank: Short-Term – Upswing The QE Index continued its uptrend and rose around 38 points (0.35%), tagging a new 52-week high and eventually surpassed the resistance of the ascending trendline, indicating a positive development. We believe the index is in uptrend mode and may continue to advance targeting the 10,900.0 level. Meanwhile, both the momentum indicators are moving higher. However, traders may need to keep a close watch on the 10,850.0 level for any reversal signs. The QERI Index gained around 0.47% to close the session at 3,181.33. The bulls were in full control and pushed the index closer to the ascending trendline. We believe the index may continue to proceed ahead toward the 3,199.21 level until it holds onto 3,151.22. Meanwhile, the RSI is trending strongly in the overbought territory, while the MACD is diverging away from the signal line in a bullish manner indicating a likely advance. QIBK respected the support of QR74.0 and gained around 1.08%. The stock is currently at the threshold of its next resistance of QR75.0. The recent spike in volumes indicates rising buying interest. We believe with both the momentum indicators pointing higher, QIBK may be ready for a breakout above QR75.0, targeting the QR75.70 level. However, a retreat below the QR74.0 level on a closing basis may indicate a bearish signal. Al Meera Consumer Goods Co.: Short-Term – Breakout Ooredoo: Short-Term – Breakout Qatar International Islamic Bank: Short-Term – Upswing MERS cleared the resistances of QR136.90, QR139.0 and QR140.50 in a single swoop for the first time since May and gained around 4.71% on Thursday. Notably, volumes were also large on the breakout indicating potential buyers stepping in. We believe this strong breach of resistances has enough steam to test and surpass QR142.70, targeting the QR146.0 level as it has little resistance until then. The RSI and the MACD lines support a further upside. ORDS breached the resistances of QR141.50 and QR143.0 on the back of large volumes. Moreover, the stock developed a bullish Marubozu candle pattern, which usually indicates a likely advance from the current level. We believe the stock has been gaining strength since clearing both the moving averages and may continue to move ahead toward QR145.0. Meanwhile, the RSI is moving strongly in the overbought territory, while the MACD is rising up. QIIK continued its bullish momentum and tagged another new 52week high. The stock is relentlessly tagging new 52-week highs over the past few days and is in uptrend mode. Meanwhile, the RSI is trending strongly in the overbought territory, while the MACD is widening further away from the signal line and is rising upward with no immediate trend reversal signs. In addition, the stock developed a bullish Marubozu candle pattern indicating continuation of this rally. Page 1 of 2
  • 2. Name (Ticker) Last Close Trend Short Term Support Long Term First Resistance Second First Second Qatar Exchange Index (QE Index) 10,873.08 UP UP 10,850.00 10,800.00 10,900.00 10,975.00 Al Rayan Islamic Index (QERI Index) 3,181.33 UP UP 3,151.22 3,123.00 3,199.21 3,220.00 Masraf Al Rayan (MARK QD) 33.40 UP UP 32.75 32.00 34.15 34.40 Commercial Bank of Qatar (CBQK QD) 73.70 UP UP 73.30 72.80 74.00 74.50 Doha Bank (DHBK QD) 63.00 UP UP 63.00 62.30 64.45 65.00 Qatar Islamic Bank (QIBK QD)* 74.90 UP UP 74.00 72.30 75.00 75.70 Qatar International Islamic Bank (QIIK QD)* 68.00 UP UP 67.25 66.20 69.00 69.90 Qatar Insurance (QATI QD) 71.40 UP UP 71.00 70.50 72.10 72.80 National Leasing Holding Co. (NLCS QD) 30.90 UP UP 30.60 30.00 31.45 31.80 Widam Food Co. (WDAM QD) 53.20 FLAT UP 53.00 51.90 54.00 54.70 Al Meera Consumer Goods Co. (MERS)* 142.20 UP UP 140.50 139.00 142.70 146.00 Industries Qatar (IQCD QD) 173.90 UP UP 173.00 171.00 174.20 175.10 Qatar Electricity & Water Co. (QEWS QD) 177.80 UP UP 177.20 176.00 180.00 182.50 Gulf International Services (GISS QD) 67.70 UP UP 67.00 66.20 68.80 69.40 Qatari Investors Group (QIGD QD) 50.50 UP UP 49.50 47.70 52.40 56.20 Barwa Real Estate Co. (BRES QD) 30.95 UP UP 30.85 30.50 31.20 31.90 United Development Co. (UDCD QD) 22.95 DOWN FLAT 22.85 22.50 23.35 23.50 Ooredoo (ORDS QD)* 144.00 UP UP 143.00 141.50 145.00 145.90 Vodafone Qatar (VFQS QD) 11.00 DOWN UP 10.83 10.50 11.00 11.19 Nakilat (QGTS QD) 20.75 DOWN UP 20.35 20.00 21.07 21.32 Milaha (QNNS QD) 91.00 UP UP 89.40 88.60 91.00 91.30 Banks and Financial Services Banks and Consumer Goods and Services Consumer G Industrials Industrials Real Estate Real Estate Telecom Telecom Transportation Transportat *These stocks are today’s suggested ideas Overall Methodology: The charts and descriptions on Page 1 provide an indicative view of the future direction of the equities mentioned. The table on page 2 has been provided to denote historical movements in certain stocks. The historical trend analysis uses 21- and 55day SMAs for indicating short-term and long-term trends, respectively. Based on these SMAs, the historical direction of the trend is denoted as UP, DOWN or FLAT. Selection of Key Stocks of the Day: Key stocks’ selection is based on our analysis of 19 members of the QE Index (excludes QNBK QD). Analysis includes identifying trends (short-term as well as long-term), patterns and support/resistance levels. Trend Direction: The methods used to determine trend direction are subjective in nature. We use 21-day SMA and 55-day SMA, absolute price movements, price movements relative to SMAs and accurately drawn trend lines and chart patterns to determine the short- and long-term trends. Investment Horizon: The definition of short term and long term depends upon investors’ preferences and their investment objectives. As a rule of thumb, the time horizon for traders/short-term trend is 1-3 weeks while it is 1-3 months for investors/long-term trend. Combining Technical and Fundamental Analysis: Investors can combine technical analysis (TA) with fundamental analysis (FA) to maximize their investment returns. While the “True Value” of stocks could be estimated by FA, the entry and exit timings could be fine tuned using technical analysis to benefit from short-term movements in stock prices. Trading Tactics: The trend direction should be analyzed based on the time-horizon of your investments. In general, investors attempt selling close to resistance levels during a downtrend and attempt buying close to support levels during uptrend. Definitions: 1> Simple Moving Average (SMA): A SMA is the average of the closing price of a security for a given period. 2> RSI (Relative Strength Index): A technical momentum indicator that ranges from 0 to 100 and compares the stock’s recent price movements by evaluating recent gains and losses. Stocks with RSI above 70 could be considered overbought and below 30 could be considered oversold. If the RSI falls below 70, it is a bearish signal. On the other hand, if the RSI rises above 30 it is considered bullish. We use a RSI of 14 days. 3> MACD (Moving Average Convergence Divergence): MACD denotes the relationship between two moving averages, which is used to spot changes in strength, direction, momentum and duration of a stock price trend. The MACD is calculated by subtracting the 26-day exponential moving average (EMA) from the 12-day EMA. A nine-day EMA of the MACD, called the signal line, is also plotted on top of the MACD, functioning as a trigger for buy/sell signals. The MACD line above the signal line provides a positive signal and vice versa. Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Tel: (+974) 4476 6534 saugata.sarkar@qnbfs.com.qa Head of Trading Tel: (+974) 4476 6535 ahmed.shehada@qnbfs.com.qa Head of Sales Tel: (+974) 4476 6533 keith.whitney@qnbfs.com.qa Manager - HNWI Tel: (+974) 4476 6544 sahbi.alkasraoui@qnbfs.com.qa Contact Center: (+974) 4476 6666 PO Box 24025 Doha, Qatar DISCLAIMER: This publication has been prepared by QNB Financial Services SPC (“QNBFS”) a wholly-owned subsidiary of Qatar National Bank (“QNB”). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange; QNB is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. While this publication has been prepared with the utmost degree of care by our analysts, QNBFS does not make any representations or warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS. Page 2 of 2