23 March Daily technical trader Presentation Transcript
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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Downmove
The QE Index fell around 21 points (-0.18%) for the second
consecutive session. The index failed to reclaim the 11,400.0 level
and drifted down as sustained selling at higher levels pushed the
index lower. However, the index trimmed its losses and recovered
from its intraday low of 11,329.76 to finally close at 11,367.31. We
believe the index may continue to slide and re-test its immediate
support at 11,338.41, as long as it trades below the 11,400.0 level.
Qatar International Islamic Bank: Short-Term – Upmove
QIIK cleared the resistances of QR71.50 and the descending
trendline in a single trading session, which had restricted its bullish
run in the past. Moreover, the stock developed a bullish Marubozu
candle pattern, which indicates a higher move. We believe if QIIK
manages to cling onto to the QR71.50 level, it may set a stage for an
upward move toward QR72.80. However, a dip below QR71.50 may
result in a false breakout. Meanwhile, the RSI is moving up.
Al Rayan Islamic Index: Short-Term – Upmove
The QERI Index extended its gains and tagged another new all-time
high of 3,498.31, but later trimmed its gains to close at 3,485.84. The
index has been tagging new highs over the past few days and is in an
uptrend mode, showing no reversal signs. Meanwhile, the bullishness
in the RSI is intact; while the MACD is growing more bullish, indicating
the index has further strength to tag new highs. However, if the index
dips below the 3,481.42 level, it may result in a pullback.
Industries Qatar: Short-Term – Upmove
IQCD has been in an upmove mode since rebounding from its
support of QR175.0. The stock is now approaching toward its
immediate resistance of QR180.0. If the stock manages to breach this
level, it may spark additional buying interest. This may push the stock
to test QR181.40, which is also in proximity of the 55-day moving
average. However, a decline below QR178.30 on a closing basis may
halt its current upmove.
Qatar Insurance: Short-Term – Upmove
QATI moved above the QR64.0 level and breached its resistance of
the 21-day moving average. The stock has been gradually moving up
the ascending trendline after it held onto its support of the 55-day
moving average. Further, the stock has developed a bullish Marubozu
candle pattern, indicating a possibility of a higher move toward
QR65.68. However, a dip below the 21-day moving average may
drag the stock to test the QR64.0 level.
Commercial Bank of Qatar: Short-Term – Downmove
CBQK failed to make any further headway above QR61.67 and
reversed. The stock penetrated below QR60.92 on the back of large
volumes, which is a negative sign. We believe this breakdown of
support has bearish implications and provides a further downside
target of QR59.33. Moreover, the stock developed a red Marubozu
candle pattern, indicating a possibility of a lower move. Meanwhile,
both the indicators are pointing down, indicating continued weakness.
Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC
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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,
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*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
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.
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) 11,367.31 DOWN UP 11,338.41 11,300.00 11,400.00 11,484.45
Al Rayan Islamic Index (QERI Index) 3,485.84 UP UP 3,481.42 3,458.51 3,490.49 3,530.00
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 38.50 FLAT UP 38.00 36.55 39.10 40.00
Commercial Bank of Qatar (CBQK QD)* 60.00 DOWN DOWN 59.33 58.75 60.92 61.67
Doha Bank (DHBK QD) 58.40 DOWN DOWN 58.20 57.40 60.00 62.00
Qatar Islamic Bank (QIBK QD) 72.90 DOWN DOWN 71.80 70.50 74.10 75.00
Qatar International Islamic Bank (QIIK QD)* 71.60 DOWN UP 70.30 69.40 72.80 74.40
Qatar Insurance (QATI QD)* 64.90 UP UP 64.00 62.64 65.68 66.90
National Leasing Holding Co. (NLCS QD) 28.10 DOWN DOWN 28.00 27.52 29.15 29.95
Consumer Goods and Services Consumer G
Widam Food Co. (WDAM QD) 45.50 UP DOWN 44.50 43.20 47.80 48.75
Al Meera Consumer Goods Co. (MERS) 161.40 UP UP 159.00 154.90 164.00 165.00
Industries Qatar (IQCD QD)* 178.90 DOWN DOWN 175.00 173.00 180.00 181.40
Qatar Electricity & Water Co. (QEWS QD) 171.00 DOWN UP 168.00 165.36 174.36 176.64
Gulf International Services (GISS QD) 79.00 UP UP 78.80 75.20 80.00 81.00
Qatari Investors Group (QIGD QD) 55.60 UP DOWN 54.00 52.40 56.20 58.00
Barwa Real Estate Co. (BRES QD) 35.30 UP UP 34.80 34.20 36.30 37.00
United Development Co. (UDCD QD) 21.85 DOWN DOWN 21.70 21.50 22.00 22.20
Ooredoo (ORDS QD) 139.80 DOWN DOWN 138.50 136.00 139.90 141.00
Vodafone Qatar (VFQS QD) 12.20 UP UP 12.09 11.90 12.40 12.66
Nakilat (QGTS QD) 19.76 DOWN DOWN 19.50 19.28 20.00 20.26
Milaha (QNNS QD) 93.00 DOWN UP 91.30 90.00 95.10 96.50