18 February Daily technical trader


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18 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 – Neutral Masraf Al Rayan: Short-Term – Downmove The QE Index continued its upward momentum and rallied aggressively moving up around 178 points (1.54%), tagging another new 52-week high. The index witnessed a gap-up opening and cleared the 11,600.0 and 11,700.0 psychological levels in a single swoop. We believe the index is currently in uptrend mode and may continue to advance toward the 11,750.0-11,780.0 levels. However, the 11,700.0 level must be closely watched for any reversal signs. The QERI Index extended its bullish rally and rose around 1.14%, tagging another new all-time high of 3,382.68. However, the index reversed and closed near its day’s open as buyers backed away from higher prices developing a Doji candle pattern. This pattern usually indicates a trend reversal which was bullish until now. We believe the index may consolidate or decline before its next upmove. However, a close above 3,382.68 may keep its uptrend intact. MARK has been experiencing steady decline over the past few days and penetrated below the support of the QR39.10 level. Moreover, the stock developed a bearish Marubozu candle pattern indicating the possibility of a further pullback. In addition, the RSI has shown a bearish divergence, while the MACD is stalling from the rising mode indicating a likely retreat toward QR38.0. However, a move above QR39.10 on a closing basis may halt its downmove. Ooredoo: Short-Term – Breakout Milaha: Short-Term – Breakout Qatar Electricity & Water Co.: Short-Term – Upswing ORDS cleared the resistances of QR149.0 along with the 21-day moving average for the first time since January on the back of large volumes. This strong breach of resistances has bullish implications and provides an upside target of QR155.0. Moreover, the stock has support for a further higher move from both the momentum indicators, which are pointing up. However, a dip below the 21-day moving average may indicate a false breakout. QNNS surpassed the resistances of QR92.0 and QR94.50 in a single trading session, tagging a 52-week high. Notably, volumes were also high on the breakout indicating that potential buyers are stepping in. Moreover, the stock developed a long bullish Marubozu candle pattern indicating a likely continuation of the upmove. Meanwhile, the RSI is moving up in a bullish manner, while the MACD is widening away from the signal line on the upside. QEWS continued its upmove tagging another new all-time high. The stock has been moving higher over the past few days and is in bullish mode. Meanwhile, the RSI and the MACD lines are moving higher and are showing no immediate trend reversal signs. We believe the stock may continue to advance and tag new highs until it trades above the QR190.0 level. However, if the stock dips below this level it may result in consolidation before its next upmove. 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) 11,724.20 UP UP 11,700.00 11,660.00 11,780.00 11,832.00 Al Rayan Islamic Index (QERI Index) 3,362.32 UP UP 3,330.00 3,300.00 3,382.68 3,400.00 Masraf Al Rayan (MARK QD)* 39.00 UP UP 38.00 36.55 40.00 41.00 Commercial Bank of Qatar (CBQK QD) 74.10 UP UP 73.50 72.80 74.50 75.00 Doha Bank (DHBK QD) 65.90 UP UP 64.00 63.30 66.50 67.00 Qatar Islamic Bank (QIBK QD) 82.20 UP UP 81.50 80.20 82.20 83.50 Qatar International Islamic Bank (QIIK QD) 73.40 UP UP 72.80 72.50 73.50 74.50 Qatar Insurance (QATI QD) 82.00 UP UP 81.00 80.00 82.50 84.60 National Leasing Holding Co. (NLCS QD) 28.90 DOWN DOWN 28.50 28.00 29.15 29.95 Widam Food Co. (WDAM QD) 47.45 DOWN DOWN 47.15 46.00 49.30 50.30 Al Meera Consumer Goods Co. (MERS) 158.00 UP UP 154.90 153.70 160.00 162.00 Industries Qatar (IQCD QD) 193.10 UP UP 192.40 190.00 195.00 197.70 Qatar Electricity & Water Co. (QEWS QD)* 191.20 UP UP 190.00 188.00 194.30 196.00 Gulf International Services (GISS QD) 84.40 UP UP 82.50 81.00 84.60 86.00 Qatari Investors Group (QIGD QD) 42.15 DOWN DOWN 41.00 39.50 43.45 44.50 Barwa Real Estate Co. (BRES QD) 31.50 FLAT DOWN 30.85 30.10 32.00 32.50 United Development Co. (UDCD QD) 22.60 DOWN DOWN 22.38 22.00 22.84 23.10 Ooredoo (ORDS QD)* 152.10 UP UP 149.00 145.90 155.00 157.00 Vodafone Qatar (VFQS QD) 12.53 UP UP 12.15 12.09 12.80 13.00 Nakilat (QGTS QD) 21.75 UP UP 21.44 21.07 22.00 22.50 Milaha (QNNS QD)* 95.10 UP UP 94.50 92.00 95.50 98.00 Banks and Financial Services Banks and Consumer Goods and Services Consumer G Industrials Real Estate Telecom 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