13 April Daily technical trader

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  • 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Uptrend The QE Index continued its rally and tagged a new 52-week high of 12,465.50, but later trimmed its gains to close the session at 12,397.21. However, the possibility of profit-booking cannot be ruled out after witnessing strong gains over the past few days. The index has its intermediate support near the 12,375.0 level. We believe if the index manages to stay above this level, it may advance further, or else it may drift down to test 12,300.0. Qatar International Islamic Bank: Short-Term – Upswing QIIK surged 6.64% and tagged a 52-week high on Thursday. The stock has been on an uptrend mode since moving above the 21-day moving average, and is gaining strength over the past few days. We believe with a spike in volumes, the stock may continue its advance and likely test the next level of QR84.40, followed by QR86.80. Meanwhile, the RSI is holding strong in the overbought territory, while the MACD is diverging away in a bullish manner. Al Rayan Islamic Index: Short-Term – Uptrend The QERI Index extended its rally tagging yet another all-time high to settle above the 4,000.0 mark. Notably, this was the index’s 13th consecutive day gains. The index is currently trading in an unchartered territory and has no resistance level. Meanwhile, both the indicators are looking strong and are providing no immediate trend reversal signals. This suggests that the index may continue to tag new highs. Barwa Real Estate Co.: Short-Term – Pullback BRES failed to make any further headway above QR38.40 and reversed, penetrating below the support level of QR37.40. We believe although the stock is trading close to its immediate support of QR36.80, it is unlikely that BRES may cling onto it and decline further to test the 21-day moving average. However, a close above QR37.40 may halt its downmove. Meanwhile, the RSI is pointing down, while the MACD has crossed the signal line into the negative territory. Qatar Islamic Bank: Short-Term – Upmove QIBK surpassed both the resistances of QR77.0 and the ascending triangle at QR78.80 in a single swoop on the back of large volumes, which is a positive signal. The stock faces its next resistance at QR80.20. If QIBK manages to trade above this level on a closing basis, it may rally further and test QR81.70. However, on the downside, traders should watch out for QR78.80 as it now acts as a support level. Both indicators look strong for a further advance. Ooredoo: Short-Term – Pullback ORDS pulled back after testing its resistance near QR151.0 and breached its support of QR149.0. Notably, volumes were also large on the decline, indicating a negative sign. Moreover, the stock developed a bearish piercing candle pattern, which usually indicates a reversal in the bullish trend. We believe the stock may continue to drift down further and test its immediate support of QR145.30, which is also in proximity to the 55-day moving average.
  • 2. Contacts Saugata Sarkar Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@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) 12,397.21 UP UP 12,300.00 12,216.75 12,450.00 12,513.25 Al Rayan Islamic Index (QERI Index) 4,007.19 UP UP 3,952.00 3,900.00 4,030.00 4,050.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 43.80 UP UP 42.00 40.00 45.00 48.00 Commercial Bank of Qatar (CBQK QD) 69.70 UP UP 67.50 65.75 70.00 71.90 Doha Bank (DHBK QD) 62.10 UP FLAT 59.23 58.20 63.30 64.50 Qatar Islamic Bank (QIBK QD)* 79.70 UP UP 78.80 77.00 80.20 81.70 Qatar International Islamic Bank (QIIK QD)* 83.50 UP UP 81.50 80.00 84.40 86.80 Qatar Insurance (QATI QD) 74.40 UP UP 72.40 71.00 75.00 76.50 Al Khalij Commercial Bank (KCBK QD) 22.64 UP UP 21.80 21.50 23.00 23.30 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 78.90 UP UP 76.40 75.40 79.00 80.00 Al Meera Consumer Goods Co. (MERS QD) 181.00 UP UP 175.00 164.00 182.00 185.00 Industrials Industries Qatar (IQCD QD) 184.50 UP FLAT 181.40 178.30 187.50 190.00 Qatar Electricity & Water Co. (QEWS QD) 185.20 UP UP 182.00 180.00 188.00 190.00 Gulf International Services (GISS QD) 91.00 UP UP 90.00 86.60 93.00 95.00 Qatari Investors Group (QIGD QD) 59.00 UP UP 58.00 56.20 61.30 64.80 Real Estate Barwa Real Estate Co. (BRES QD)* 37.00 UP UP 36.80 35.70 38.40 39.20 United Development Co. (UDCD QD) 22.40 UP UP 22.00 21.69 22.66 23.00 Telecom Ooredoo (ORDS QD)* 147.90 UP UP 145.30 143.50 149.00 151.00 Vodafone Qatar (VFQS QD) 13.80 UP UP 12.99 12.66 14.00 14.23 Transportat Nakilat (QGTS QD) 21.35 UP UP 21.15 20.90 21.83 22.00 Milaha (QNNS QD) 97.00 UP UP 96.50 95.10 98.40 100.10