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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Upmove
The QE Index continued its northward journey for the third
consecutive session and gained around 244 points (1.83%) to close
at its intraday high. The index remained in upmove mode throughout
the day and showed no signs of profit-booking as the bulls went
berserk. Moreover, the index developed a bullish Marubozu candle
pattern indicating a likely continuation of this upmove toward
13,600.0. Conversely, 13,500.0 may act as psychological support.
Industries Qatar: Short-Term – Rebound
IQCD rebounded and breached the 21-day and 55-day moving
averages along with the descending trendline, which had restricted its
bullish move in the past. This strong breach of resistances has bullish
implications. We believe based on the recent price action and spike in
volumes the stock may proceed further to test QR180.0. However,
any retreat below QR178.30 may drag the stock down. Meanwhile,
the RSI is showing strength and is moving up in a bullish manner.
Al Rayan Islamic Index: Short-Term – Upmove
The QERI Index extended its winning streak for the third straight
session and rose around 75 points to settle above 4,650.0 for the first
time since May. The index witnessed a positive opening and
continued to carry on the bullish momentum breaching its important
resistance of 4,639.0. Further, both the momentum indicators support
the index for a higher move toward its all-time high. Meanwhile, the
index could find support at the 4,639.0 level.
Al Meera Consumers Goods Co.: Short-Term – Uptrend
MERS surpassed the important resistance of QR194.80 and tagged a
new high yesterday. Notably, volumes were also large on the rise
indicating rising optimism among traders. Moreover, the stock has
been moving along the rising channel over the past few weeks and is
in uptrend mode. We believe with both the momentum indicators
providing bullish signals, the stock may continue to record a new high.
However, traders should watch out for QR194.80 for any reversal.
Masraf Al Rayan: Short-Term – Bounce Back
MARK gained 3.67% and cleared the resistances of the 21-day
moving average and QR55.80 in a single swoop. Moreover, the stock
moved above the range after consolidating below it over the past few
weeks, which is a positive sign. Further, the RSI has shown a bullish
divergence indicating a likely higher move. Thus, traders could
consider buying the stock at the current level and on declines up to
QR56.0 for a target of QR57.30, with a stop loss of QR55.80.
Vodafone Qatar: Short-Term – Breakout
VFQS surged 7.86% and breached the resistances of QR20.0 and
QR20.78 for the first time since May along with the ascending wedge
with increased participation. Moreover, the stock developed a long
bullish Marubozu candlestick pattern indicating a likely continuation of
this upmove. We believe the stock may continue its bullish
momentum and advance further to test QR21.99. Further, both the
indicators are in the buy zone supporting this bullish sentiment.
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
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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
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*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
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.
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) 13,522.79 UP UP 13,500.00 13,350.54 13,584.34 13,694.19
Al Rayan Islamic Index (QERI Index) 4,655.16 UP UP 4,638.81 4,600.00 4,672.95 4,700.00
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD)* 56.50 UP UP 55.80 54.00 57.30 59.90
Commercial Bank of Qatar (CBQK QD) 68.60 UP UP 68.30 67.30 69.50 70.00
Doha Bank (DHBK QD) 60.50 UP UP 60.00 58.00 61.00 62.00
Qatar Islamic Bank (QIBK QD) 109.80 UP UP 109.50 107.00 111.90 112.50
Qatar International Islamic Bank (QIIK QD) 85.00 FLAT UP 83.50 82.80 85.00 86.10
Qatar Insurance (QATI QD) 94.10 UP UP 92.40 91.00 94.60 96.00
Al Khalij Commercial Bank (KCBK QD) 22.00 DOWN DOWN 21.99 21.80 22.35 22.60
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 126.40 UP UP 121.50 118.20 126.50 128.80
Al Meera Consumer Goods Co. (MERS QD)* 197.00 UP UP 194.80 190.00 198.80 200.00
Industries Qatar (IQCD QD)* 179.00 UP UP 178.30 175.50 180.00 181.40
Qatar Electricity & Water Co. (QEWS QD) 188.00 UP UP 186.00 184.00 188.00 190.00
Gulf International Services (GISS QD) 121.10 UP UP 121.00 118.10 122.50 124.00
Qatari Investors Group (QIGD QD) 58.60 UP UP 57.70 56.20 60.60 61.30
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 42.10 UP UP 41.80 41.00 42.50 43.50
United Development Co. (UDCD QD) 30.40 UP UP 29.90 29.30 30.61 31.93
Ooredoo (ORDS QD) 130.00 DOWN DOWN 129.70 126.00 131.50 133.90
Vodafone Qatar (VFQS QD)* 21.40 UP UP 20.78 20.00 21.99 22.30
Nakilat (QGTS QD) 25.00 UP UP 24.45 24.12 25.30 25.90
Milaha (QNNS QD) 96.60 UP UP 96.50 95.10 97.80 98.30