4 May Daily technical trader Presentation Transcript
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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Bounce Back
The QE Index extended its gains around 50 points (0.39%) and
moved above the 12,700.0 psychological level. However, the index
faces its next important resistance near 12,770.0. If the index
manages to surpass this level on a closing basis, it may gain further
momentum and may rally toward 12,800.0-12,850.0 levels. On the
downside, 12,680.0 will act as a good support. Meanwhile, both the
momentum indicators are providing mixed signals.
Milaha: Short-Term – Downmove
QNNS continued its decline and penetrated below the 21-day moving
average. The stock has been on a declining mode over the past few
days and has struggled to move above the descending trendline.
Moreover, the stock developed a bearish Marubozu candle pattern,
indicating a likely lower move. Although the stock is sitting exactly at
its support of QR97.0, it is unlikely to cling onto it and drift lower to test
QR95.10. A close above QR97.28 may halt its downmove.
Al Rayan Islamic Index: Short-Term – Bounce Back
The QERI Index witnessed a gap-up opening and marginally moved
higher around 3 points (0.06%) to close the session at 4,195.24. The
index faces an immediate resistance near 4,212.0, whereas support
is seen near the 4,150.0 level. We expect the index to oscillate
between these levels. The bulls will be back in action only if the index
manages to trade above 4,212.0, until then it is likely to consolidate.
Meanwhile, the RSI is stalling, while the MACD is moving down.
Nakilat: Short-Term – Upmove
QGTS breached its interim resistance of QR24.20 and made further
headway on Thursday. The recent price action and spike in volumes
indicate that the stock has enough steam to test and surpass its
immediate resistance of QR24.61, targeting the QR25.0 level.
However, any failure to clear QR24.61 may result in a pullback and
the stock could test QR24.20. Meanwhile, both the indicators look
strong for a further rally with no immediate trend reversal signs.
Al Meera Consumer Goods Co.: Short-Term – Upmove
MERS cleared its resistance of QR185.0 after feigning a failure in the
past few attempts. Further, the stock developed a bullish engulfing
candle pattern, indicating a likely continuation of this upmove. We
believe with volumes picking up on the rise, potential buyers are
stepping in. The stock may now march toward its next resistance of
QR187.50. However, a dip below QR185.0 may drag the stock back
into the congestion zone. Meanwhile, the RSI is moving up.
Industries Qatar: Short-Term – Upmove
IQCD gained 2.47% and breached its resistances of QR181.40 and
the 21-day moving average in a single swoop. The stock also
developed a bullish Marubozu candle pattern, indicating a likely
continuation of the upmove toward QR183.0. Any move above this
level may spark additional buying interest and test QR184.95.
However, a dip below the 21-day moving average may result in a
pullback. Meanwhile, the RSI has shown a bullish divergence.
Saugata Sarkar Keith Whitney Sahbi Kasraoui QNB Financial Services SPC
Head of Research Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666
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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) 12,727.64 UP UP 12,678.84 12,600.00 12,768.17 12,850.00
Al Rayan Islamic Index (QERI Index) 4,195.24 UP UP 4,148.08 4,100.00 4,211.12 4,247.34
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 47.45 UP UP 47.00 45.90 48.50 49.75
Commercial Bank of Qatar (CBQK QD) 68.50 UP UP 67.30 66.50 69.80 70.70
Doha Bank (DHBK QD) 65.00 UP UP 63.90 62.00 65.70 66.40
Qatar Islamic Bank (QIBK QD) 87.20 UP UP 84.70 81.70 87.30 88.50
Qatar International Islamic Bank (QIIK QD) 84.40 UP UP 83.00 80.70 86.10 98.50
Qatar Insurance (QATI QD) 75.40 UP UP 74.80 72.50 76.00 77.00
Al Khalij Commercial Bank (KCBK QD) 22.60 DOWN UP 21.80 21.29 22.90 23.23
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 89.00 UP UP 87.80 85.00 90.50 92.00
Al Meera Consumer Goods Co. (MERS QD)* 185.80 UP UP 185.00 183.00 187.50 190.00
Industries Qatar (IQCD QD)* 182.40 UP DOWN 181.40 180.00 183.00 184.95
Qatar Electricity & Water Co. (QEWS QD) 183.30 UP UP 180.00 178.18 184.00 186.00
Gulf International Services (GISS QD) 89.30 DOWN UP 86.60 84.80 90.00 93.00
Qatari Investors Group (QIGD QD) 66.00 UP UP 64.70 61.30 68.40 71.70
Barwa Real Estate Co. (BRES QD) 38.15 UP UP 37.40 36.80 38.40 39.20
United Development Co. (UDCD QD) 25.65 UP UP 25.29 24.70 26.00 26.50
Ooredoo (ORDS QD) 147.00 FLAT UP 145.00 143.00 148.00 149.00
Vodafone Qatar (VFQS QD) 16.79 UP UP 16.56 16.00 16.89 17.30
Nakilat (QGTS QD)* 24.59 UP UP 24.20 23.90 24.61 25.00
Milaha (QNNS QD)* 97.00 UP UP 95.10 93.00 98.30 100.10