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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Pullback
The QE Index continued its bearish spell for the second straight
session and fell sharply around 330 points (-2.43%). The index
witnessed heavy selling pressure as soon as it slipped below
13,500.0 as the bears took complete control over the bulls. However,
the index recovered from its intraday low of 13,104.21 to close at
13,221.29. Meanwhile, the bulls would ideally want to see a pause
near 13,196.0, but a dip below it may result in a further decline.
Qatar Electricity & Water Co.: Short-Term – Pullback
QEWS penetrated below its important supports of QR196.0 and
QR192.0 along with the ascending trendline in a single trading
session. Moreover, the stock developed a bearish candlestick
formation indicating a likely continuation of this pullback. Further, both
momentum indicators have shown a negative divergence. Thus,
traders could consider selling this stock at the current level for a target
price of QR188.0 with a stop loss at the QR192.0 level.
Al Rayan Islamic Index: Short-Term – Pullback
The QERI Index continued its southward journey for the third
consecutive day and plunged -2.08% to settle below 4,450.0. The
index after touching its intraday high of 4,551.16 reversed and dipped
below the support near 4,530.0, caving under heavy selling pressure.
However, the index rebounded from its day’s low of 4,396.44 as
buying interest helped to trim its losses. Meanwhile, the index needs
to hold 4,440.0 to keep its uptrend intact or else it may further retreat.
Vodafone Qatar: Short-Term – Pullback
VFQS declined yesterday after developing a Tweezer top formation
on Monday. The stock is currently trading close to its immediate
support of QR20.79. Traders may consider selling this stock if it
trades below QR20.79 targetting QR20.0. However, if the stock
manages to cling onto QR20.79 on a closing basis it may attempt an
advance. Meanwhile, the RSI is retreating further from the overbought
territory, thus supporting this bearish sentiment.
Qatar Islamic Bank: Short-Term – Pullback
QIBK dipped below its supports of QR102.0, QR100.0 and QR98.50
in a single swoop on the back of large volumes, which is a negative
sign. Moreover, the stock has been experiencing selling pressure
since topping the rally at QR115.0 over the past two days. With the
RSI and the MACD lines pointing lower, it seems the stock may
further drift down and test its immediate support of QR96.0, which is
also in proximity to the 21-day moving average.
Industries Qatar: Short-Term – Pullback
IQCD continued its decline and further breached the support of the
21-day moving average on the back of increased volumes. Moreover,
the stock has been moving along the descending trendline over the
past few days and is struggling to move above it. We believe although
the stock is trading close to its immediate support of QR186.40, it may
not cling onto it and drift down further to test QR185.0. However, if
IQCD manages to hold onto QR186.40 it may halt its pullback.
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
email@example.com firstname.lastname@example.org email@example.com firstname.lastname@example.org email@example.com 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.
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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) 13,221.29 UP UP 13,195.88 13,100.00 13,350.54 13,447.17
Al Rayan Islamic Index (QERI Index) 4,444.48 UP UP 4,400.00 4,341.10 4,500.00 4,528.58
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 59.40 UP UP 57.30 56.00 59.90 61.00
Commercial Bank of Qatar (CBQK QD) 67.00 DOWN DOWN 65.75 64.92 67.30 68.40
Doha Bank (DHBK QD) 61.70 DOWN DOWN 61.00 59.75 62.00 63.00
Qatar Islamic Bank (QIBK QD)* 97.00 UP UP 96.00 93.90 98.50 100.00
Qatar International Islamic Bank (QIIK QD) 84.90 DOWN UP 83.00 80.70 86.10 87.80
Qatar Insurance (QATI QD) 77.00 UP UP 76.00 74.80 78.00 79.00
Al Khalij Commercial Bank (KCBK QD) 23.10 DOWN UP 22.90 22.50 23.23 23.49
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 85.00 DOWN UP 85.00 83.00 87.80 90.50
Al Meera Consumer Goods Co. (MERS QD) 183.50 DOWN UP 183.00 182.00 185.00 187.50
Industries Qatar (IQCD QD)* 186.50 DOWN FLAT 186.40 185.00 188.50 191.00
Qatar Electricity & Water Co. (QEWS QD)* 191.90 UP UP 188.00 186.00 192.00 196.00
Gulf International Services (GISS QD) 92.00 DOWN UP 90.00 86.60 93.00 95.00
Qatari Investors Group (QIGD QD) 64.00 DOWN UP 62.40 61.30 66.50 68.40
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 42.00 UP UP 42.00 41.40 44.50 46.00
United Development Co. (UDCD QD) 26.30 FLAT UP 26.00 25.29 26.45 27.35
Ooredoo (ORDS QD) 154.00 UP UP 153.50 151.00 155.20 157.30
Vodafone Qatar (VFQS QD)* 20.89 UP UP 20.79 20.00 21.00 21.50
Nakilat (QGTS QD) 23.70 DOWN UP 23.40 22.45 24.20 24.61
Milaha (QNNS QD) 94.00 DOWN DOWN 93.10 87.30 95.10 96.50
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