24 February Daily technical trader

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24 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 – Upmove Industries Qatar: Short-Term – Upmove The QE Index continued its upward momentum and rose around 13 points (0.11%) to close at 11,885.78. Moreover, the index rebounded from its day’s low of 11,820.64 as buying interest pushed it closer to the 11,900.0 level. However, the index faces its immediate resistance near the 11,900.0-11,915.72 levels, which it needs to clear in order to gain further momentum. Any failure to move above this level may result in consolidation. The QERI Index extended its strong rally and moved higher around 0.22%, tagging another new all-time high. Moreover, the index respected the support of 3,382.68 as well as the ascending trendline and continued its upmove, as buyers stepped in & quickly offset the weakness. We believe the index has been in uptrend mode and may continue to advance tagging new highs. However, traders may need to keep a close watch on the 3,382.68 level for any reversal signs. IQCD moved higher around 1.60% and tagged a new 52-week high on the back of increased volumes. The stock has been trading sideways over the past few days, but eventually managed to move above the QR195.0 level which is a positive signal. We believe the stock may continue its upmove and tag new 52-week highs until its trades above QR195.0. Meanwhile, both the momentum indicators are providing bullish signals indicating the possibility of a further rally. Qatar Electricity & Water Co.: Short-Term – Upswing Al Meera Consumer Goods Co.: Short-Term – Downmove Ooredoo: Short-Term – Breakout QEWS witnessed a gap-up opening and surpassed the QR194.30 level, tagging a new all-time high. We believe based on the current higher push the stock may continue to proceed ahead and tag new highs. Meanwhile, the RSI is trending strongly in the overbought territory, while the MACD is diverging away from the signal line in a bullish manner and are showing no imminent trend reversal signs. However, a dip below the QR194.30 level may halt its upmove. MERS continued its downmove yesterday after penetrating below its support of QR154.90 on Thursday. Moreover, the stock has been witnessing a steady decline since topping the rally near QR159.0. We believe although the stock is trading close to its immediate support of QR151.0, it seems unlikely that MERS may hold onto it and drift down further to test its 21-day moving average. Meanwhile, the RSI and the MACD lines are pointing down indicating weakness to continue. ORDS cleared the QR153.0 level after consolidating below it over the past few days. The stock has been in uptrend mode since clearing the 21-day moving average and is gradually gaining strength. We believe if the stock can cling onto QR153.0 a continued rise and a chance of a further upmove toward QR157.0 cannot be ruled out. However, a dip below QR153.0 on a closing basis may indicate a false breakout. Meanwhile, both the indicators are pointing higher. 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) 11,885.78 UP UP 11,832.00 11,754.45 11,915.72 12,000.00 Al Rayan Islamic Index (QERI Index) 3,393.22 UP UP 3,382.68 3,350.00 3,400.00 3,430.00 Masraf Al Rayan (MARK QD) 39.35 UP UP 38.00 36.55 40.00 41.00 Commercial Bank of Qatar (CBQK QD) 74.90 UP UP 74.00 73.50 75.00 75.40 Doha Bank (DHBK QD) 67.00 UP UP 67.00 66.50 68.50 69.30 Qatar Islamic Bank (QIBK QD) 81.00 UP UP 80.20 79.40 82.20 83.00 Qatar International Islamic Bank (QIIK QD) 75.00 UP UP 74.00 73.30 75.50 76.25 Qatar Insurance (QATI QD) 65.00 UP UP 64.00 63.20 66.80 67.50 National Leasing Holding Co. (NLCS QD) 29.00 DOWN DOWN 28.50 28.00 29.95 30.10 Widam Food Co. (WDAM QD) 45.90 DOWN DOWN 44.50 43.25 48.10 49.30 Al Meera Consumer Goods Co. (MERS)* 152.00 UP UP 151.00 148.90 153.70 154.90 Industries Qatar (IQCD QD)* 197.00 UP UP 195.00 192.40 197.70 199.00 Qatar Electricity & Water Co. (QEWS QD)* 195.70 UP UP 194.30 192.00 198.00 200.00 Gulf International Services (GISS QD) 80.80 DOWN UP 79.90 78.00 82.50 84.60 Qatari Investors Group (QIGD QD) 41.05 DOWN DOWN 41.00 39.50 43.45 44.50 Barwa Real Estate Co. (BRES QD) 32.70 UP UP 32.00 31.60 32.85 33.50 United Development Co. (UDCD QD) 22.51 DOWN DOWN 22.38 22.00 22.84 23.10 Ooredoo (ORDS QD)* 154.90 UP UP 153.00 149.00 157.00 159.00 Vodafone Qatar (VFQS QD) 12.40 UP UP 12.15 12.09 12.80 13.00 Nakilat (QGTS QD) 22.00 UP UP 22.00 21.83 22.50 22.80 Milaha (QNNS QD) 98.70 UP UP 98.00 97.00 100.00 101.27 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

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