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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Bounce Back
The QE Index rose for the second consecutive day and gained
around 250 points (2.06%) to settle near the 12,400.0 level. The
index witnessed a gap-up opening, and gained momentum by
convincingly breaching the 12,200.0 and 12,300.0 levels. We believe
a close above 12,400.0 would heighten optimism among traders and
the current rally may extend up to 12,465.0-12,500.0 levels.
Conversely, 12,350.0 may act as an immediate support level.
Medicare Group: Short-Term – Rebound
MCGS gained 6.75% and breached its resistances of QR83.40 and
the 21-day and 55-day moving averages in a single trading session.
Notably, volumes were also large on the rise, indicating that potential
buyers are stepping in. Moreover, with both the momentum indicators
pointing higher, MCGS’ preferred direction seems to be on the
upside. Traders could consider buying the stock at the current level
for a target of QR86.0-86.50 with a stop loss of QR85.0.
Al Rayan Islamic Index: Short-Term – Bounce Back
The QERI index extended its gains for the second straight session
and rallied around 95 points, surpassing the important psychological
level of 4,100.0. The index made a strong opening and reached an
intraday high of 4,142.03, but later trimmed its gains to close at
4,120.14. We believe with the momentum indicators providing bullish
signals, the index may further rally toward 4,150.0. On the flip side,
any retreat below the 4,100.0 level may result in a pullback.
Qatar Islamic Bank: Short-Term – Rebound
QIBK rallied sharply and gained 7.1%, clearing both the 21-day and
55-day moving averages in a single swoop. Moreover, the stock
developed a bullish Marubozu candle pattern, indicating continuation
of this bullish move. We believe the stock has enough steam to
surpass its immediate resistance of QR93.90, targeting QR95.10.
However, traders may exercise caution if the stock declines below the
21-day moving average. Meanwhile, both the indicators look strong.
Al Khalij Commercial Bank: Short-Term – Bounce Back
KCBK moved above its resistance of QR21.49 yesterday after
witnessing a brief correction over the past few days. Further, with
volumes also picking up and the RSI showing bullish divergence, it
seems the stock may be ready for a move toward QR21.87, which is
also in proximity to the 21-day moving average. However, traders
may need to keep a close watch on QR21.49 for any reversal signs,
as a decline below this level may drag the stock.
Vodafone Qatar: Short-Term – Bounce Back
VFQS built on its gains and advanced 5.10% yesterday. Moreover,
the stock breached its resistance of QR17.70 on the back of large
volumes, which is a positive sign. We believe based on the current
bullish momentum, the stock may advance further and test its next
level of QR18.75, which is also in proximity to the 55-day moving
average. Further, the RSI is moving up in a bullish manner toward the
mid-line. However, a dip below QR18.0 may halt its rebound.
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
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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
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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) 12,384.24 DOWN DOWN 12,375.03 12,216.75 12,465.50 12,513.50
Al Rayan Islamic Index (QERI Index) 4,120.14 DOWN DOWN 4,100.00 4,065.50 4,148.08 4,211.12
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 51.50 DOWN FLAT 51.00 49.75 52.60 54.00
Commercial Bank of Qatar (CBQK QD) 65.20 FLAT DOWN 64.92 63.67 65.75 66.30
Doha Bank (DHBK QD) 57.00 DOWN DOWN 56.50 55.80 57.40 58.10
Qatar Islamic Bank (QIBK QD)* 93.50 UP UP 90.70 90.00 93.90 95.10
Qatar International Islamic Bank (QIIK QD) 83.00 UP DOWN 81.70 80.70 83.00 86.58
Qatar Insurance (QATI QD) 80.10 UP UP 80.00 79.00 81.00 81.40
Al Khalij Commercial Bank (KCBK QD)* 21.57 DOWN DOWN 21.49 20.88 21.87 22.00
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD)* 85.40 UP UP 83.40 81.90 86.00 87.00
Al Meera Consumer Goods Co. (MERS QD) 174.00 FLAT DOWN 164.00 161.00 175.00 179.00
Industries Qatar (IQCD QD) 172.00 DOWN DOWN 171.00 169.50 173.90 174.90
Qatar Electricity & Water Co. (QEWS QD) 185.00 UP DOWN 184.00 182.00 186.00 188.00
Gulf International Services (GISS QD) 96.00 UP UP 95.00 93.00 97.00 98.00
Qatari Investors Group (QIGD QD) 51.80 DOWN DOWN 50.00 48.40 54.40 56.00
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 39.35 FLAT FLAT 38.40 38.05 40.10 41.00
United Development Co. (UDCD QD) 24.50 FLAT DOWN 24.00 23.42 24.75 25.30
Ooredoo (ORDS QD) 129.50 DOWN DOWN 128.00 125.80 130.00 133.90
Vodafone Qatar (VFQS QD)* 18.15 DOWN DOWN 17.70 16.89 18.75 19.29
Nakilat (QGTS QD) 22.11 DOWN DOWN 21.80 21.56 22.19 22.45
Milaha (QNNS QD) 92.90 UP DOWN 91.20 90.20 93.00 94.90