9 June Daily technical trader


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9 June Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Neutral The QE Index fell around 83 points (-0.62%) and closed the session below the 13,150.0 level. The index made a strong opening and momentarily moved above 13,300.0, but failed to make any further headway & reversed. Moreover, the index penetrated below its supports of the 21-day moving average and 13,196.0 in a single swoop as the bears overpowered the bulls. We believe the index may witness further weakness if it fails to reclaim the 13,196.0 level. United Development Co.: Short-Term – Pullback UDCD failed to move above its stiff resistance of QR26.45 and drifted lower dipping below the support of the 21-day moving average. The stock is currently trading exactly on top of its immediate support of QR26.00. Traders may consider selling the stock if it starts trading below QR26.00 for a target of QR25.29. However, UDCD may attract buyers if it manages to reclaim the 21-day moving average. Meanwhile, both the indicators are providing bearish signals. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index shed around -0.49% to close the session at its day’s low of 4,430.46. The index witnessed a gap-up opening and reached an intraday high of 4,483.93, but failed to hold onto its gains and declined breaching its support of 4,445.0. Meanwhile, the index needs to move above the 4,445.0 level in order to keep its uptrend intact. On the flip side, any failure to move above the 4,445.0 level may result in a pullback and the index may test its 21-day moving average. Nakilat: Short-Term – Downmove QGTS penetrated below the important support of the descending triangle at QR23.90 after failing to clear the rigid resistance of the 21- day moving average. Moreover, the stock developed a bearish Marubozu candle pattern indicating a likely continuation of this downmove. Further, both the momentum indicators are pointing down. Thus, traders may consider selling the stock at the current level for a target of QR23.40 with a stop loss of the QR23.90 level. Qatar Insurance: Short-Term – Upmove QATI gained 2.18% and breached its resistances of QR78.0 and QR79.0 in a single swoop. Notably, volumes were also large on the upmove indicating rising optimism among traders. We believe this strong breach of resistances has bullish implications and provides an upside target of QR81.40. Meanwhile, the RSI is positively poised, while the MACD has crossed the signal line in a bullish manner. However, any dip below QR79.0 may halt QATI’s upmove. Industries Qatar: Short-Term – Downmove IQCD continued its bearish spell yesterday and dipped below the supports of QR182.50 and QR181.40 in a single swoop. Moreover, the stock has been in declining mode and is moving along the descending trendline over the past few days. We believe although the stock is sitting exactly on top of its support of QR180.0, it may not cling onto it and further drift lower to test QR178.30. However, if the stock manages to hold onto QR180.0 it may provide some relief.
  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) 13,149.55 DOWN UP 13,100.00 13,019.55 13,195.88 13,350.54 Al Rayan Islamic Index (QERI Index) 4,430.46 UP UP 4,400.00 4,341.10 4,444.86 4,500.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 57.90 UP UP 57.30 56.00 58.00 59.90 Commercial Bank of Qatar (CBQK QD) 67.00 DOWN DOWN 65.75 64.92 67.30 68.40 Doha Bank (DHBK QD) 61.90 DOWN DOWN 61.00 59.90 62.00 63.00 Qatar Islamic Bank (QIBK QD) 100.00 UP UP 98.50 96.00 100.00 102.00 Qatar International Islamic Bank (QIIK QD) 86.00 DOWN UP 83.00 80.70 86.10 87.80 Qatar Insurance (QATI QD)* 79.60 UP UP 79.00 78.00 81.40 83.00 Al Khalij Commercial Bank (KCBK QD) 23.19 DOWN UP 22.90 22.50 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 84.80 DOWN UP 83.00 81.70 85.00 87.80 Al Meera Consumer Goods Co. (MERS QD) 182.00 DOWN UP 182.00 180.00 183.00 185.00 Industrials Industrials Industries Qatar (IQCD QD)* 180.00 DOWN DOWN 180.00 178.30 181.40 182.50 Qatar Electricity & Water Co. (QEWS QD) 189.80 DOWN UP 188.00 186.00 192.00 196.00 Gulf International Services (GISS QD) 90.70 DOWN FLAT 90.00 86.60 91.40 93.00 Qatari Investors Group (QIGD QD) 64.30 DOWN UP 62.40 61.30 66.50 68.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 42.75 UP UP 41.40 41.00 43.00 44.50 United Development Co. (UDCD QD)* 26.00 DOWN UP 26.00 25.29 26.45 27.35 Telecom Telecom Ooredoo (ORDS QD) 150.40 UP UP 149.00 147.40 151.00 153.50 Vodafone Qatar (VFQS QD) 20.30 UP UP 20.00 19.29 20.79 21.50 Transportation Transportat Nakilat (QGTS QD)* 23.81 DOWN UP 23.40 22.45 23.90 24.20 Milaha (QNNS QD) 91.90 DOWN DOWN 91.20 90.20 93.10 95.10