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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Upmove
The QE Index rose around...
Contacts
Saugata Sarkar Abdullah Amin, CFA Shahan Keushgerian Sahbi Kasraoui Ahmed Al-Khoudary QNB Financial Services SPC
...
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6 August Daily technical trader

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6 August Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove The QE Index rose around 182 points (1.40%) and extended its gains for the second session. The index rallied strongly to breach the 13,000.0 and 13,100.0 psychological levels in a single swoop, which signifies strength. The index is rapidly approaching toward the 13,200.0 level. Traders should watch out for a move above this level, as it may resume the next leg of a higher wave. On the flip side, 13,100.0 may act as a near-term support. United Development Co.: Short-Term – Upswing UDCD gained 4.50% and surpassed the resistances of QR29.30 and QR29.90 to tag a new 52-week high. The stock has shown strength and been in an upmove mode since clearing the 55-day moving average. We believe based on the recent price swing and spike in volumes, the stock may extend its gains toward QR30.60, followed by QR31.90. However, traders may keep a close watch on QR29.90 for any reversal signs. Meanwhile, both the indicators are looking strong. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index continued its northward journey for the third consecutive session and surged over 2% to settle near the 4,500.0 mark. The index cleared 4,450.0 and showed a one-way movement with not even an iota of profit-booking as the bulls went berserk. Meanwhile, both the momentum indicators are providing bullish signals, suggesting the index may continue its rally toward the 4,530.0 level. Conversely, the index may find support near 4,450.0. Qatar Islamic Bank: Short-Term – Upmove QIBK continued its rally and advanced 3.43%, breaching the key resistance of QR111.0 yesterday. Notably, volumes were also large, indicating the increased optimism among traders. We believe the stock would continue its positive momentum and rally further toward QR115.0 in the next few trading sessions. Meanwhile, both the indicators are supporting this bullish sentiment by moving up. However, a dip below QR111.0 may drag the stock down. Qatari Investors Group: Short-Term –Bounce Back QIGD jumped 5.57% and cleared the resistances of QR52.40, the 21- day moving average and the descending trendline, which had restricted its bullish move in the past. Moreover, the rise in price was supported by large volumes, indicating strength. We believe this strong breach of resistances has bullish implications and provides an upside target of QR56.20. However, a dip below QR54.66 may halt its upmove. Meanwhile, the RSI has shown a bullish divergence. Gulf International Services: Short-Term – Upmove GISS breached the interim resistance of QR117.90 and moved higher after consolidating below it over the past few days. We believe if the stock manages to cling onto QR117.90, it may rally further to record new highs. Moreover, the RSI is moving strongly into the overbought territory, while the MACD is diverging away from the signal line toward the upside indicating a likely advance. However, any retreat below QR117.90 may pull the stock back into the congestion zone.
  2. 2. Contacts 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 saugata.sarkar@qnbfs.com.qa abdullah.amin@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa sahbi.alkasraoui@qnbfs.com.qa ahmed.alkhoudary@qnbfs.com.qa 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 *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 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. Name (Ticker) Last Close Trend Support Resistance Short Term Long Term First Second First Second Qatar Exchange Index (QE Index) 13,173.64 UP UP 13,079.52 12,939.80 13,195.88 13,350.54 Al Rayan Islamic Index (QERI Index) 4,497.70 UP UP 4,444.86 4,375.30 4,528.58 4,638.81 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 54.20 UP UP 54.00 52.50 55.80 57.30 Commercial Bank of Qatar (CBQK QD) 67.00 DOWN FLAT 66.50 65.90 67.30 68.30 Doha Bank (DHBK QD) 57.00 DOWN DOWN 56.50 55.50 57.40 58.90 Qatar Islamic Bank (QIBK QD)* 111.70 UP UP 109.50 107.00 111.90 115.10 Qatar International Islamic Bank (QIIK QD) 85.30 UP UP 85.00 83.00 86.10 87.80 Qatar Insurance (QATI QD) 92.00 UP UP 91.00 88.90 92.40 94.00 Al Khalij Commercial Bank (KCBK QD) 22.50 UP UP 22.35 21.99 22.60 23.23 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 125.90 UP UP 124.00 121.50 128.80 130.00 Al Meera Consumer Goods Co. (MERS QD) 191.00 UP UP 190.00 187.80 194.80 196.00 Industrials Industrials Industries Qatar (IQCD QD) 173.00 DOWN DOWN 172.30 170.10 173.90 175.45 Qatar Electricity & Water Co. (QEWS QD) 186.00 UP FLAT 184.00 182.00 186.00 188.90 Gulf International Services (GISS QD)* 118.90 UP UP 118.10 115.00 119.50 122.00 Qatari Investors Group (QIGD QD)* 55.00 UP DOWN 54.20 52.40 56.20 57.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 38.95 DOWN DOWN 38.40 37.50 39.20 39.70 United Development Co. (UDCD QD)* 30.20 UP UP 29.90 29.30 30.61 31.93 Telecom Telecom Ooredoo (ORDS QD) 129.00 DOWN DOWN 129.70 126.00 129.70 134.20 Vodafone Qatar (VFQS QD) 19.69 UP UP 19.29 18.75 20.00 20.78 Transportation Transportat Nakilat (QGTS QD) 24.90 UP UP 24.45 24.12 25.30 25.90 Milaha (QNNS QD) 91.40 DOWN DOWN 91.30 90.20 92.90 94.35
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