22 May Daily technical trader


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22 May Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Pullback The QE Index continued its bearish spell for the sixth consecutive session and declined around 55 points (-0.43%). The index made an attempt to move above its resistance near 12,770.0, but it slipped below 12,700.0 erasing all its day’s gains as the bears once again proved to be more dominant than the bulls. We believe traders are likely to witness further retracement if the index fails to reclaim 12,700.0. However, a move above 12,700.0 may attract buyers. Al Khalij Commercial Bank : Short-Term – Rebound KCBK bounced back yesterday and gained around 1.90% clearing its resistances of QR23.23 and the 21-day moving average along with the descending trendline in a single swoop. We believe based on the current higher push and spark in volumes the stock has enough steam to test and surpass its immediate resistance of QR23.49, targeting QR24.0. However, a retreat below QR23.23 may drag the stock. Meanwhile, the RSI has shown a bullish divergence. Al Rayan Islamic Index: Short-Term – Pullback The QERI Index continued to move lower and dipped marginally around 2 points for the fourth straight session (-0.04%) to close at 4,229.11. However, the index recovered from its intraday low of 4,188.21 as buyers stepped in and quickly offset the weakness, trimming majority of its losses. Meanwhile, the index needs to clear its resistances of 4,247.34 and the 21-day moving average in order to resume its uptrend, until then it may continue to drift lower. Ooredoo: Short-Term – Downmove ORDS has been in declining mode over the past few days and further breached its supports of the 55-day moving average and QR143.0 along with the ascending trendline in a single trading session. Moreover, the stock developed a bearish Marubozu candle pattern indicating a likely continuation of this downmove. We believe the stock may continue to drift lower and test QR141.80. A close above QR143.0 may provide some relief. Both indicators look weak. Masraf Al Rayan: Short-Term – Upmove MARK cleared its resistance of QR49.75 on Tuesday and continued to move higher gaining 0.60% on the back of large volumes, which is a positive sign. We believe if the stock manages to cling onto its support of QR49.75 on a closing basis; it may proceed higher toward its next resistance of QR51.0. Any move above this level may spark additional buying interest, which could push the stock further higher toward QR51.80. A dip below QR49.75 may result in a pullback. Nakilat: Short-Term – Downmove QGTS extended its losses yesterday penetrating below its important support of QR23.40, which has bearish implications. We believe the stock may continue to head lower and test its next support of QR22.45 as it has little support until then. Thus, the prognosis of this time frame implies more downside as the RSI is moving further down from the mid-line and the MACD is widening away in a bearish manner. A close above QR23.40 may halt its downmove.
  2. 2. Contacts Saugata Sarkar Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@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) 12,679.53 DOWN UP 12,678.84 12,600.00 12,700.00 12,768.17 Al Rayan Islamic Index (QERI Index) 4,229.11 DOWN UP 4,211.42 4,148.08 4,247.34 4,301.89 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 50.20 UP UP 49.75 48.50 51.00 51.80 Commercial Bank of Qatar (CBQK QD) 67.00 DOWN UP 66.30 65.75 67.80 68.40 Doha Bank (DHBK QD) 62.80 DOWN UP 62.00 60.00 63.30 65.70 Qatar Islamic Bank (QIBK QD) 91.60 UP UP 90.00 89.00 93.90 96.00 Qatar International Islamic Bank (QIIK QD) 86.00 FLAT UP 83.00 80.70 86.10 87.80 Qatar Insurance (QATI QD) 75.40 DOWN UP 74.80 72.50 76.00 77.00 Al Khalij Commercial Bank (KCBK QD)* 23.40 DOWN UP 23.23 22.90 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 85.80 DOWN UP 83.00 81.70 86.25 87.00 Al Meera Consumer Goods Co. (MERS QD) 182.50 DOWN UP 180.00 179.00 183.00 185.00 Industrials Industrials Industries Qatar (IQCD QD) 179.50 DOWN DOWN 178.30 175.00 180.00 181.40 Qatar Electricity & Water Co. (QEWS QD) 180.00 DOWN UP 180.00 178.18 182.00 184.00 Gulf International Services (GISS QD) 94.90 UP UP 93.00 91.00 95.00 97.00 Qatari Investors Group (QIGD QD) 64.20 DOWN UP 62.40 61.30 66.50 68.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 38.50 FLAT UP 38.40 37.40 39.20 40.35 United Development Co. (UDCD QD) 25.85 FLAT UP 25.29 24.65 26.00 26.45 Telecom Telecom Ooredoo (ORDS QD)* 142.50 DOWN FLAT 141.80 140.50 143.00 145.00 Vodafone Qatar (VFQS QD) 17.84 DOWN UP 17.30 16.89 17.99 18.49 Transportation Transportat Nakilat (QGTS QD)* 23.27 DOWN UP 22.45 21.98 23.40 23.90 Milaha (QNNS QD) 93.30 DOWN DOWN 92.90 91.30 95.10 96.50