23 January Daily technical trader


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23 January 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 Al Meera Consumer Goods Co.: Short-Term – Upswing The QE Index after reclaiming the 11,100.0 level on Tuesday extended its gains and rose around 32 points (0.29%), tagging a new 52-week high. The index momentarily penetrated below the 11,100.0 level, but recovered and witnessed a strong rally as bulls overpowered the bears. We believe the index is trending strong and may continue its bullish momentum targeting the 11,200.0-11,250.0 levels. Both indicators look strong for a further upmove. The QERI Index remained in bullish mode and moved higher around 0.63% to close the session at 3,234.28. Moreover, the index managed to sustain above the 3,199.21 level and rallied as buyers pushed prices closer to its all-time high of 3,240.37. The index needs to clear this level on a closing basis in order to witness a further rally. However, if the index fails to move above 3,240.37, it may consolidate. Meanwhile, the RSI line is providing a bullish signal. MERS witnessed a gap-down opening, but later managed to reclaim QR142.70 and continued its upmove. We believe the stock may maintain its higher move and continue to scale higher targeting QR145.90 until it holds onto the QR142.70 level. Meanwhile, the RSI is moving strongly in the overbought territory, while the MACD is diverging away from the signal line in a bullish manner. However, a dip below QR142.70 may result in bearish implications. Ooredoo: Short-Term – Upswing Qatari Investors Group: Short-Term – Breakout Vodafone Qatar: Short-Term – Upmove ORDS cleared the QR148.0 level and continued its upmove, tagging a 52-week high. Moreover, the stock has been in uptrend mode and gaining strength since clearing both moving averages. We believe ORDS is trending strong and may continue to advance, tagging new 52-week highs. Moreover, the stock has support for a further higher move from the RSI and the MACD lines, which are moving up in a bullish manner indicating that this rally may not fizzle out soon. QIGD breached the resistances of QR47.70 and the descending trendline in a single swoop, which had restricted its bullish move in the past. The stock surged 7.63% after developing a hammer candle pattern on Tuesday, thus confirming this trend reversal pattern. With volumes also picking up, we believe QIGD may be ready for a move above the 21-day moving average, targeting QR52.40 as it has little resistance until then. Meanwhile, the RSI is moving up. VFQS continued to move higher yesterday after surpassing the resistance of QR11.44 on Tuesday, thus confirming strength in the upmove. The stock is currently at the threshold of its immediate resistance of QR11.60. If the stock manages to penetrate above this key level, it may spark a short-term rally, which may push the stock to test QR12.09. However, any failure may pull it toward QR11.44. Meanwhile, the RSI and the MACD lines are providing bullish signals. 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) 11,179.61 UP UP 11,100.00 11,060.00 11,200.00 11,250.00 Al Rayan Islamic Index (QERI Index) 3,234.28 UP UP 3,199.21 3,185.46 3,240.37 3,300.00 Masraf Al Rayan (MARK QD) 35.00 UP UP 35.00 34.15 36.00 37.25 Commercial Bank of Qatar (CBQK QD) 74.10 UP UP 74.00 73.30 74.50 75.30 Doha Bank (DHBK QD) 64.90 UP UP 64.50 63.90 66.00 66.75 Qatar Islamic Bank (QIBK QD) 75.00 UP UP 74.00 73.00 75.00 75.70 Qatar International Islamic Bank (QIIK QD) 70.00 UP UP 69.40 68.00 70.30 71.00 Qatar Insurance (QATI QD) 74.00 UP UP 73.00 72.30 74.30 75.00 National Leasing Holding Co. (NLCS QD) 30.30 DOWN DOWN 29.95 29.15 30.60 31.00 Widam Food Co. (WDAM QD) 53.00 UP UP 51.90 51.00 53.00 54.00 Al Meera Consumer Goods Co. (MERS)* 144.00 UP UP 142.70 140.50 145.90 148.00 Industries Qatar (IQCD QD) 178.40 UP UP 178.30 177.00 180.00 181.20 Qatar Electricity & Water Co. (QEWS QD) 180.60 FLAT UP 180.00 178.90 182.50 184.00 Gulf International Services (GISS QD) 70.90 UP UP 70.00 68.80 71.20 72.00 Qatari Investors Group (QIGD QD)* 48.65 DOWN UP 47.70 46.00 49.09 52.40 Barwa Real Estate Co. (BRES QD) 32.00 UP UP 31.60 31.20 32.60 33.20 United Development Co. (UDCD QD) 23.25 UP UP 23.15 22.85 23.50 23.94 Ooredoo (ORDS QD)* 148.50 UP UP 148.00 145.90 150.00 152.00 Vodafone Qatar (VFQS QD)* 11.56 UP UP 11.44 11.19 11.60 12.09 Nakilat (QGTS QD) 21.04 UP UP 20.74 20.50 21.32 21.44 Milaha (QNNS QD) 90.00 UP UP 90.00 89.40 91.30 93.00 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