13 August Daily technical trader


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13 August Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove The QE Index rose around 142 points (1.08%) and ended the session in the green for the second straight session. Moreover, the index successfully cleared the 13,200.0 level after feigning a failure in the past few attempts. We believe the bulls may continue to dominate the bears and push the index toward 13,350.0. Conversely, 13,250.0 may act as an intermediate support. Meanwhile, the RSI has rejected the mid-line and is moving up in a bullish manner. Gulf International Services: Short-Term – Upmove GISS convincingly cleared the important resistance of QR118.10 after moving sideways for the majority of the week. Moreover, the stock developed a bullish Marubozu candle pattern, which usually indicates a higher move. We believe the stock may approach QR119.50, which if breached, may result in a further higher move. Meanwhile, the RSI is showing strength in the overbought territory. However, traders should exercise caution if the stock retreats below QR118.10. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index moved higher for the second consecutive day and gained 1.16% to close above 4,550.0. The index showed one-way bullish movement with not even an iota of profit-booking. Further, the index breached the upper end of the channel range of 4,529.0 after moving sideways over the past few days. Thus, the prognosis of this time implies a further upside toward 4,600.0. On the flip side, the index may find support at 4,550.0. United Development Co.: Short-Term – Upmove UDCD eventually surpassed the resistance of the ascending triangle at QR30.15, tagging a 52-week high. Notably, volumes were also large on the rise. The stock has been showing strength since clearing the 55-day moving average and is in upmove mode. Meanwhile, with both the momentum indicators looking strong UDCD’s preferred direction seems to be on the upside and it may test QR31.90 over the near-term. However, a dip below QR30.15 may halt its upmove. Doha Bank: Short-Term – Bounce Back DHBK breached the resistances of the 21-day moving average and the ascending wedge line at QR58.0 in a single swoop. We believe based on the current higher push the stock may test and surpass the 55-day moving average targeting the QR60.0 level. Further, the RSI has shown a bullish divergence, while the MACD is diverging away from the signal line toward the upside. On the flip side, a decline below QR58.0 may pull the stock back into the congestion zone. Barwa Real Estate Co.: Short-Term – Bounce Back BRES jumped 4.10% and moved above the resistances of QR41.80 along with both the 21-day and 55-day moving averages on the back of large volumes. We believe this strong breach of resistances has bullish implications. Further, the RSI is in the buy zone, while the MACD is showing signs of recovery. We believe the stock may continue its rally and test QR42.50, followed by QR43.20. However, a dip below QR41.80 may result in a pullback.
  2. 2. Contacts Saugata Sarkar Abdullah Amin, CFA Shahan Keushgerian Sahbi Kasraoui Ahmed Al-Khoudary QNB Financial Services SPC Head of Research Senior Research Analyst Senior Research Analyst Manager - HNWI Head of Sales Trading – Institutional Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6569 Tel: (+974) 4476 6509 Tel: (+974) 4476 6544 Tel: (+974) 4476 6548 PO Box 24025 saugata.sarkar@qnbfs.com.qa abdullah.amin@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa sahbi.alkasraoui@qnbfs.com.qa ahmed.alkhoudary@qnbfs.com.qa 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 *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 55- day 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. Name (Ticker) Last Close Trend Support Resistance Short Term Long Term First Second First Second Qatar Exchange Index (QE Index) 13,279.27 UP UP 13,195.88 13,079.52 13,350.54 13,584.34 Al Rayan Islamic Index (QERI Index) 4,580.30 UP UP 4,528.58 4,444.86 4,638.81 4,672.95 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 54.50 FLAT UP 54.00 52.50 55.80 57.30 Commercial Bank of Qatar (CBQK QD) 68.00 FLAT UP 67.30 66.50 68.30 69.50 Doha Bank (DHBK QD)* 58.90 UP FLAT 58.00 57.40 60.00 61.00 Qatar Islamic Bank (QIBK QD) 109.00 UP UP 107.00 104.50 109.50 111.90 Qatar International Islamic Bank (QIIK QD) 84.50 FLAT UP 83.50 82.80 85.00 86.10 Qatar Insurance (QATI QD) 92.50 UP UP 92.40 91.00 93.00 94.60 Al Khalij Commercial Bank (KCBK QD) 22.03 DOWN DOWN 21.99 21.80 22.35 22.60 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 125.00 UP UP 121.50 118.20 126.50 128.80 Al Meera Consumer Goods Co. (MERS QD) 192.90 UP UP 190.00 187.80 194.80 196.00 Industrials Industrials Industries Qatar (IQCD QD) 173.00 DOWN DOWN 172.30 169.50 173.90 175.50 Qatar Electricity & Water Co. (QEWS QD) 186.00 FLAT FLAT 184.00 182.00 186.00 188.00 Gulf International Services (GISS QD)* 119.20 UP UP 118.10 115.00 119.50 122.00 Qatari Investors Group (QIGD QD) 58.90 UP UP 57.70 56.20 60.60 61.30 Real Estate Real Estate Barwa Real Estate Co. (BRES QD)* 41.85 UP UP 41.80 41.00 42.50 43.50 United Development Co. (UDCD QD)* 30.50 UP UP 29.90 29.30 30.61 31.93 Telecom Telecom Ooredoo (ORDS QD) 130.00 DOWN DOWN 129.70 126.00 131.50 133.90 Vodafone Qatar (VFQS QD) 19.84 FLAT UP 19.29 18.75 20.00 20.78 Transportation Transportat Nakilat (QGTS QD) 25.20 UP UP 24.45 24.12 25.30 25.90 Milaha (QNNS QD) 95.80 UP UP 95.10 94.80 96.50 98.30