20 August 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 – Bounce Back The QE Index extended its gains for the second straight session and rose around 37 points (0.27%). The index remained in upbeat mode throughout the day, as the bulls were under complete control. However the index trimmed its gains after reaching near 13,800.0, as traders opted to book profits. Meanwhile, the index may continue to proceed ahead until it stays above 13,650.0. On the flip side, any retreat below 13,650.0 may pull the index toward 13,600.0. Barwa Real Estate Co.: Short-Term – Upmove BRES advanced 1.31% and cleared the important resistance of QR42.50 after feigning a failure in the past few attempts, which is a positive signal. Moreover, the stock has been moving along the ascending channel line over the past few days and is gaining momentum. Further, the RSI is in the buy zone, while the MACD is moving on the upside. Traders could buy the stock at the current level for a target of QR43.20, with a strict stop loss of QR42.50. Al Rayan Islamic Index: Short-Term – Uptrend The QERI Index continued its bullish momentum and scaled yet another all-time high. However, the index shed its gains at 4,770.31 on the back of profit-booking to close at 4,727.72. Meanwhile, the index has been in uptrend mode and formed higher tops & higher bottoms, which is usually a bullish indication. We believe the index may extend this rally further and record fresh highs. Conversely, 4,700.0 may act as a psychological support. Qatar Islamic Bank: Short-Term – Upmove QIBK gained 1.04% and moved above QR115.0, tagging another fresh 52-week high on the back of large volumes. The stock has been showing strength since moving above both the moving averages and is in upmove mode. Further, the RSI and MACD lines are pointing higher, indicating that this rally may extend further. We believe the stock may march toward its next resistance of QR118.0. However, any retreat below QR115.0 may halt its upmove. Qatar Insurance: Short-Term – Uptrend QATI moved higher and tagged a new all-time high yesterday. The stock has moved upward after a brief consolidation around QR92.0 and is registering gains over the past few days. Further, the RSI and the MACD lines are looking strong indicating strength in the upmove. We believe the stock may continue its rally further and tag new highs. However, any failure to move above QR97.10 may result in consolidation resulting in a sideways movement. Medicare Group: Short-Term – Uptrend MCGS surged 5.71% and recorded a new all-time high on the back of increased participation. The stock has been looking strong on the charts and has been in uptrend mode. We believe based on the recent price action and increased optimism among traders, the stock may extend this rally further tagging fresh highs. Meanwhile, both the momentum indicators are positively poised, showing no immediate trend reversal signs, indicating a further acceleration.
  • 2. Contacts 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 saugata.sarkar@qnbfs.com.qa abdullah.amin@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa sahbi.alkasraoui@qnbfs.com.qa ahmed.alkhoudary@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) 13,682.04 UP UP 13,584.34 13,447.24 13,694.19 13,753.36 Al Rayan Islamic Index (QERI Index) 4,727.72 UP UP 4,707.59 4,685.20 4,770.31 4,800.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 55.80 UP UP 55.80 54.00 57.30 59.90 Commercial Bank of Qatar (CBQK QD) 68.00 FLAT UP 67.30 66.50 68.30 69.50 Doha Bank (DHBK QD) 60.00 UP UP 60.00 58.00 61.00 62.00 Qatar Islamic Bank (QIBK QD)* 116.20 UP UP 115.00 112.50 118.00 119.50 Qatar International Islamic Bank (QIIK QD) 84.40 DOWN UP 83.50 82.80 85.00 85.90 Qatar Insurance (QATI QD)* 97.00 UP UP 96.00 94.60 97.10 98.50 Al Khalij Commercial Bank (KCBK QD) 21.96 DOWN DOWN 21.80 21.49 22.00 22.35 Consumer Goods and Services Consumer G Medicare Group (MCGS QD)* 135.20 UP UP 132.00 128.80 139.40 141.00 Al Meera Consumer Goods Co. (MERS QD) 191.70 UP UP 190.00 188.70 193.00 194.80 Industrials Industrials Industries Qatar (IQCD QD) 186.10 UP UP 184.50 183.10 186.40 188.50 Qatar Electricity & Water Co. (QEWS QD) 189.00 UP UP 188.00 186.00 190.00 192.00 Gulf International Services (GISS QD) 120.30 UP UP 118.10 115.00 121.00 122.50 Qatari Investors Group (QIGD QD) 60.30 UP UP 59.70 57.70 60.60 61.30 Real Estate Real Estate Barwa Real Estate Co. (BRES QD)* 42.55 UP UP 42.50 41.80 43.20 43.80 United Development Co. (UDCD QD) 30.10 UP UP 29.90 29.30 30.45 30.61 Telecom Telecom Ooredoo (ORDS QD) 124.10 DOWN DOWN 123.70 122.90 126.00 128.50 Vodafone Qatar (VFQS QD) 21.65 UP UP 20.78 20.00 21.99 22.30 Transportation Transportat Nakilat (QGTS QD) 24.60 UP UP 24.45 24.12 25.00 25.30 Milaha (QNNS QD) 95.90 UP UP 95.10 93.00 96.50 97.80