16 February Daily technical trader

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16 February Daily technical trader

  1. 1. TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove Al Rayan Islamic Index: Short-Term – Upmove National Leasing Holding Co.: Short-Term – Breakdown The QE Index extended its relentless run and moved higher around 63 points (0.55%), tagging another new 52-week. The index witnessed a gap-down opening, but rebounded from its day’s low of 11,415.38, recording an impressive rally closing at its highest level since 2008. Bulls continued their domination over the bears for the sixth consecutive session and pushed the index above 11,500.0. Further, both indicators support the index for a higher move. The QERI Index respected the 3,270.24 level and continued its advance, tagging another new all-time high. We believe the index has been in uptrend mode and may continue to accelerate further, tagging new highs. Meanwhile, the RSI is moving strongly in the overbought territory, while the MACD has crossed the signal line into the positive territory indicating the strength to continue. However, traders may need to keep a close watch near 3,285.0 for any reversal signs. NLCS witnessed a gap-down opening and penetrated below the important support of QR29.95 along with both the 21-day and 55-day moving averages for the first time since October. Moreover, volumes were also large on the breakdown which is a negative signal. In addition, the RSI has shown a bearish divergence and the MACD is pointing down indicating the weakness to continue. We believe the stock may drift down further and test QR29.15, followed by QR28.50. Qatar Islamic Bank: Short-Term – Upswing Al Meera Consumer Goods Co.: Short-Term – Breakout Vodafone Qatar: Short-Term – Breakout QIBK continued its upward momentum and cleared the QR79.70 and QR80.20 levels, tagging another new 52-week high. With volumes also picking up we believe QIBK may continue to proceed ahead toward QR81.50. Meanwhile, the bullishness in the RSI is intact, while the RSI is diverging away from the signal line in a bullish manner indicating that this rally may continue for a longer time. However, any pullback below the QR80.20 level may result in consolidation. MERS continued to move higher on Thursday and cleared the resistance of QR151.50. The stock has been gradually moving up over the past few days and is showing strength. We believe the stock may continue its upmove and may march toward its next resistance of QR153.70. Meanwhile, the RSI is moving strongly in the overbought territory, while the MACD is widening away from the signal line on the upside, thus supporting our bullish outlook for the stock. VFQS after consolidating for a single day on Wednesday resumed its upmove clearing the QR12.09 and QR12.15 levels, tagging a 52week high on the back of large volumes. We believe the stock may continue to advance toward QR12.50, followed by QR13.0 until it holds onto the QR12.15 level. However, any dip below this level may halt its upmove. Meanwhile, both the momentum indicators are providing bullish signals indicating the possibility of a short-term rally. Page 1 of 2
  2. 2. Name (Ticker) Last Close Trend Short Term Support Long Term First Resistance Second First Second Qatar Exchange Index (QE Index) 11,515.50 UP UP 11,484.45 11,452.97 11,590.00 11,650.00 Al Rayan Islamic Index (QERI Index) 3,291.94 UP UP 3,270.24 3,253.72 3,300.00 3,330.00 Masraf Al Rayan (MARK QD) 40.05 UP UP 39.10 38.00 41.00 42.00 Commercial Bank of Qatar (CBQK QD) 71.50 DOWN UP 70.90 70.00 71.80 72.80 Doha Bank (DHBK QD) 65.40 UP UP 64.00 63.30 65.70 66.00 Qatar Islamic Bank (QIBK QD)* 81.00 UP UP 80.20 79.70 81.50 82.20 Qatar International Islamic Bank (QIIK QD) 73.90 UP UP 73.50 72.80 74.50 75.30 Qatar Insurance (QATI QD) 82.00 UP UP 81.00 80.00 82.50 84.60 National Leasing Holding Co. (NLCS QD)* 29.45 DOWN DOWN 29.15 28.50 29.95 30.30 Widam Food Co. (WDAM QD) 48.00 DOWN DOWN 47.15 46.00 49.30 50.30 Al Meera Consumer Goods Co. (MERS)* 152.30 UP UP 151.50 149.00 153.70 155.00 Industries Qatar (IQCD QD) 179.20 UP UP 178.30 174.60 180.00 181.00 Qatar Electricity & Water Co. (QEWS QD) 183.70 UP UP 182.50 180.00 184.80 186.00 Gulf International Services (GISS QD) 84.30 UP UP 82.50 81.00 84.60 86.00 Qatari Investors Group (QIGD QD) 41.00 DOWN DOWN 41.00 39.50 41.50 43.45 Barwa Real Estate Co. (BRES QD) 30.55 DOWN DOWN 30.10 29.70 30.85 31.20 United Development Co. (UDCD QD) 22.43 DOWN DOWN 22.38 22.00 22.84 23.10 Ooredoo (ORDS QD) 148.50 UP UP 145.90 144.00 149.00 150.00 Vodafone Qatar (VFQS QD)* 12.36 UP UP 12.15 12.09 12.50 13.00 Nakilat (QGTS QD) 21.48 UP UP 21.44 21.07 22.00 22.50 Milaha (QNNS QD) 91.60 UP UP 91.30 90.00 92.00 94.50 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

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