13 May Daily technical trader

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  • 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Uptrend The QE Index continued its bullish rally for the third consecutive session and moved higher around 72 points (0.56%) to close at its new peak of 13,067.34. The index momentarily penetrated below the support near 12,940.0, but later gained momentum and convincingly breached the 13,000.0 psychological level. We believe the index is in bull-run mode and may continue to advance recording new highs. Meanwhile, the RSI is indicating that the rally may continue. Masraf Al Rayan: Short-Term – Upmove MARK extended its rally and cleared the resistance of QR49.75 yesterday. The stock has been in upmove mode since moving above the QR48.50 level and is gaining strength. We believe with volumes also picking up the stock may march toward the QR51.80 level as it has little resistance until then. However, a dip below QR49.75 may halt its upmove. Meanwhile, the RSI is moving strongly in the overbought territory indicating the possibility of a further rise. Al Rayan Islamic Index: Short-Term – Uptrend The QERI Index extended its gains and rose 0.41% to settle above the 4,300.0 level. The index finally cleared the resistance near the 4,302.0 level after consolidating below it over the past few sessions, which is a positive development. We believe the index may continue to proceed toward its all-time high if it manages to stay above the 4,302.0 level on a closing basis. However, any retreat below 4,302.0 may pull the index back into the congestion zone. Qatar Electricity & Water Co.: Short-Term – Uptrend QEWS surpassed the resistance of QR188.0 and tagged a new all- time high. We believe based on the recent price action and spike in volumes the stock may continue its rally recording new highs. However, traders may need to keep a close watch on QR188.0 for any reversal signs as a dip below it may drag the stock. The RSI has shown a bullish divergence, while the MACD has crossed the signal line into the positive territory indicating continuation of the uptrend. Gulf International Services: Short-Term – Uptrend GISS surged 4.93% and recorded a new all-time high on the back of large volumes. Moreover, the stock developed a bullish Marubozu candle pattern indicating a likely continuation of this uptrend. With the RSI pointing higher and the MACD diverging away from the signal line in a bullish manner, GISS’ preferred direction seems to be on the upside. We believe the stock may further continue its rally recording new highs, thus reinforcing our positive technical outlook. Qatar Islamic Bank: Short-Term – Upmove QIBK breached the resistances of QR89.0 and QR90.0 in a single swoop and tagged a new 52-week high on the back of large volumes. We believe this strong breach of resistances has bullish implications and provides an upside target of QR92.0, followed by QR93.20. However, a dip below QR90.0 may result in a pullback. The RSI has entered the overbought territory in a bullish manner, while the MACD is about to cross the signal line into the positive zone.
  • 2. Contacts Saugata Sarkar Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@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) 13,067.34 UP UP 13,019.55 12,939.80 13,100.00 13,175.00 Al Rayan Islamic Index (QERI Index) 4,305.57 UP UP 4,301.89 4,247.34 4,317.91 4,340.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 50.00 UP UP 49.75 48.50 51.80 53.00 Commercial Bank of Qatar (CBQK QD) 68.90 FLAT UP 68.40 67.30 69.80 70.70 Doha Bank (DHBK QD) 65.40 UP UP 63.90 62.00 65.70 66.40 Qatar Islamic Bank (QIBK QD)* 90.90 UP UP 90.00 89.00 92.00 93.20 Qatar International Islamic Bank (QIIK QD) 88.80 UP UP 87.80 86.10 89.00 90.50 Qatar Insurance (QATI QD) 74.00 DOWN UP 72.60 71.00 74.80 76.00 Al Khalij Commercial Bank (KCBK QD) 23.25 UP UP 22.90 22.49 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 89.00 UP UP 87.80 87.00 90.00 92.00 Al Meera Consumer Goods Co. (MERS QD) 183.50 DOWN UP 183.00 180.00 185.00 187.80 Industrials Industries Qatar (IQCD QD) 190.00 UP UP 188.50 186.40 190.00 194.60 Qatar Electricity & Water Co. (QEWS QD)* 189.00 UP UP 188.00 186.00 190.00 195.00 Gulf International Services (GISS QD)* 98.00 UP UP 95.50 93.00 100.00 102.00 Qatari Investors Group (QIGD QD) 66.00 UP UP 64.70 61.30 68.40 71.70 Real Estate Barwa Real Estate Co. (BRES QD) 38.25 FLAT UP 37.40 36.80 38.40 39.20 United Development Co. (UDCD QD) 26.15 UP UP 25.29 24.70 26.45 27.00 Telecom Ooredoo (ORDS QD) 145.90 DOWN UP 145.00 143.00 148.00 149.00 Vodafone Qatar (VFQS QD) 18.61 UP UP 17.99 17.30 18.75 19.29 Transportat Nakilat (QGTS QD) 24.96 UP UP 24.61 24.20 25.00 25.90 Milaha (QNNS QD) 97.80 FLAT UP 96.50 95.10 98.30 100.10