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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Neutral
The QE Index slipped by 0.19% to close at 12,436.05 on Monday,
marginally below its support level of 12,440. The index found support
during the day at the 12,400 level. The MACD continues to slide,
indicating that the index remains weak. On the other hand, the RSI is
mostly flat close to the oversold zone, suggesting that the index may
consolidate around the current level. We believe a decisive close
below 12,400 can take the index to 12,250.
Qatar Electricity & Water Co: Short-Term – Bounce Back
QEWS formed a bullish engulfing candlestick pattern on Monday as
well as closed at its highest point of the day, indicating that the stock
has strength for a further upmove. The stock has closed above its
resistance level of QR185.0. The RSI is trending higher, while the
MACD has converged with the signal line. However, investors should
exercise caution if the stocks slips back below QR182. On the upside,
the first resistance is seen at QR188, while the next is at QR192.
Qatar Al Rayan Islamic Index: Short-Term – Neutral
The QERI index fell 12.48 points (-0.3%) to close at 4,137.37 on
Monday, slipping below its support level of 4,148. The index is looking
weak on the charts, and may move to test its support level of 4,100 in
the coming days. The RSI and the MACD are in line with this bearish
view. Below the 4,100 level, the next strong support is way down at
3,974.0. However, the index after a sharp fall over the last three
weeks, may witness some consolidation before making its next move.
Commercial Bank of Qatar: Short-Term – Upmove
CBQK made a strong positive move on Monday, breaking above its
resistance level of QR65.75. The stock formed a bullish marubozu
pattern, closing at its highest point of the day. The MACD is about to
provide a positive crossover, while the RSI is trending higher. We
believe the stock has strength to test its next resistance level of
QR67.20. However, investors should exercise caution if the stock falls
below its support of QR64.90.
Ooredoo: Short-Term – Bounce Back
ORDS after falling sharply over the last few weeks, has seen some
gains over the last couple of trading sessions. The stock has made a
bullish marubozu pattern, which is a positive sign. The RSI has also
recovered from the oversold zone and is trending higher. The stock is
likely to recover further from here and test its resistance of QR139.0.
However, investors should exercise caution if the stock slips below
the QR130 level.
Medicare Group: Short-Term – Downmove
MCGS slipped below its support level of QR83 to close the day at
QR82.30. The stock is looking weak on the charts, with the RSI and
the MACD trending lower. The 21-day moving average (at QR64.69)
has also slipped below the 55-day moving average (QR64.90). If the
MCGS moves falls below QR81.7 on a closing basis, it can move
toward QR78.1. However, a close above the resistance level of
QR85.0 would indicate a reversal of the short-term downtrend.
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
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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
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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) 12,436.05 DOWN DOWN 12,250.00 12,100.00 12,513.65 12,600.0
Al Rayan Islamic Index (QERI Index) 4,137.37 DOWN DOWN 4,100.00 3,974.00 4,231.77 4,256.0
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 49.50 DOWN UP 48.50 47.40 51.80 52.30
Commercial Bank of Qatar (CBQK QD)* 66.00 FLAT DOWN 64.15 63.60 66.30 67.20
Doha Bank (DHBK QD) 58.00 FLAT DOWN 57.40 56.50 61.0 62.50
Qatar Islamic Bank (QIBK QD) 91.00 DOWN UP 90.00 86.90 93.90 96.00
Qatar International Islamic Bank (QIIK QD) 79.70 DOWN DOWN 78.30 75.50 80.70 83.00
Qatar Insurance (QATI QD) 79.50 DOWN UP 76.00 74.10 81.40 85.00
Al Khalij Commercial Bank (KCBK QD) 21.20 DOWN DOWN 21.00 20.17 22.01 22.50
Medicare Group (MCGS QD)* 82.30 DOWN DOWN 81.70 87.10 85.00 87.80
Al Meera Consumer Goods Co. (MERS QD) 168.10 DOWN DOWN 164.00 159.00 171.00 175.00
Industries Qatar (IQCD QD) 179.00 DOWN DOWN 175.50 172.60 180.00 181.40
Qatar Electricity & Water Co. (QEWS QD)* 185.50 FLAT DOWN 182.00 180.00 188.00 192.0
Gulf International Services (GISS QD) 95.30 FLAT FLAT 90.00 86.60 98.00 101.70
Qatari Investors Group (QIGD QD) 60.00 DOWN DOWN 59.70 57.80 61.30 62.40
Barwa Real Estate Co. (BRES QD) 38.85 DOWN UP 38.40 37.40 39.20 39.70
United Development Co. (UDCD QD) 24.66 DOWN DOWN 24.50 24.00 25.30 25.65
Ooredoo (ORDS QD)* 135.00 DOWN DOWN 130.0 125.10 137.50 139.00
Vodafone Qatar (VFQS QD) 19.50 DOWN UP 19.29 18.75 20.00 20.79
Nakilat (QGTS QD) 22.74 DOWN DOWN 22.45 22.00 23.40 23.90
Milaha (QNNS QD) 91.00 DOWN DOWN 90.00 88.70 93.00 94.30