14 January Daily technical trader Presentation Transcript
TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Upmove
Al Rayan Islamic Index: Short-Term – Upmove
Masraf Al Rayan: Short-Term – Breakout
The QE Index continued its upward momentum and gained around
98 points (0.89%), tagging another new 52-week high to close at
11,019.86. Moreover, the volumes were also large supporting the
index’s higher move indicating rising buying interest. We believe the
index is trending strong and may maintain its higher wave toward the
11,050.0-11,100.0 levels. Meanwhile, both momentum indicators are
in uptrend mode with no immediate trend reversal signs.
The QERI Index tagged another new all-time high, surpassing its
previous high of 3,202.18 as bulls continued their domination over the
bears. The index has been aggressively moving higher over the past
few days and may continue to advance, tagging new highs.
Moreover, the index developed a bullish Marubozu candle pattern
indicating a likely move ahead. Meanwhile, the bullishness in the RSI
is intact, while the MACD is rising further up from the signal line.
MARK cleared the resistance of QR34.15 for the first time since
December. The next obstacle the stock faces is at QR35.0. The
recent price action and rising volumes suggest that potential buyers
are stepping in. We believe the current higher push has enough
steam to test and surpass QR35.0, targeting QR36.0. Moreover, both
indicators are providing bullish signals supporting a further rise.
However, a retreat below QR34.15 may indicate a false breakout.
Milaha: Short-Term – Breakout
Doha Bank: Short-Term – Breakout
Qatar International Islamic Bank: Short-Term – Upswing
QNNS breached the resistance of QR91.30 and tagged a 52-week
high. Notably, volumes were also large on the breakout, which is a
positive sign. We believe the stock has been steadily moving higher
over the past few days and is gaining strength. Meanwhile, with the
RSI moving strongly in the overbought territory, and the MACD
moving further up from the signal line, QNNS is poised to tag new 52week highs, thus supporting our bullish outlook.
DHBK respected the support near the ascending trendline and
rebounded to surpass the resistance of QR63.30. Moreover, the stock
developed a bullish Marubozu candle pattern, which usually indicates
that the downmove could be over. With volumes also picking up, it
seems DHBK may be ready for an advance toward QR63.90.
Meanwhile, both RSI and MACD lines suggest strength for an
upmove. However, a decline below QR63.30 may halt its upmove.
QIIK continued its bullish rally and tagged another new 52-week high
yesterday. The stock has been in uptrend mode and is relentlessly
tagging new highs. Moreover, the RSI is trending higher, while the
MACD is diverging away from the signal line in a bullish manner
indicating that QIIK has enough steam to accelerate further. In
addition, the stock developed a bullish Marubozu candle pattern
indicating that this rally may not fizzle out soon.
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Qatar Exchange Index (QE Index)
Al Rayan Islamic Index (QERI Index)
Masraf Al Rayan (MARK QD)*
Commercial Bank of Qatar (CBQK QD)
Doha Bank (DHBK QD)*
Qatar Islamic Bank (QIBK QD)
Qatar International Islamic Bank (QIIK QD)*
Qatar Insurance (QATI QD)
National Leasing Holding Co. (NLCS QD)
Widam Food Co. (WDAM QD)
Al Meera Consumer Goods Co. (MERS)
Industries Qatar (IQCD QD)
Qatar Electricity & Water Co. (QEWS QD)
Gulf International Services (GISS QD)
Qatari Investors Group (QIGD QD)
Barwa Real Estate Co. (BRES QD)
United Development Co. (UDCD QD)
Ooredoo (ORDS QD)
Vodafone Qatar (VFQS QD)
Nakilat (QGTS QD)
Milaha (QNNS QD)*
Banks and Financial Services
Consumer Goods and Services
*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
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.
Simple Moving Average (SMA): A SMA is the average of the closing price of a security for a given period.
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.
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.
Ahmed M. Shehada
QNB Financial Services SPC
Head of Research
Tel: (+974) 4476 6534
Head of Trading
Tel: (+974) 4476 6535
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Manager - HNWI
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