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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Neutral
The QE Index failed to make any further headway above 13,200.0
and declined for the second straight session, shedding around 237
points (-1.79%). The index witnessed a gap-down opening and
penetrated below both the 13,100.0 and 13,000.0 levels in a single
swoop caving under selling pressure. Meanwhile, the index has an
immediate support near 12,940.0. We believe if the index manages
to stay above this level; it may rebound, failing that it could retreat.
Qatar Electricity & Water Co.: Short-Term – Rebound
QEWS bucked the trend and advanced 1.37%, breaching both its
resistances of the 21-day moving average and the rising wedge at
QR184.0 in a single trading session. Moreover, the stock developed a
bullish Marubozu candlestick pattern, indicating a continuation of this
bounce back. Further, the RSI has shown a bullish divergence. We
believe the stock may proceed toward the 55-day moving average.
However, a dip below the QR184.0 level may halt its upmove.
Al Rayan Islamic Index: Short-Term –Neutral
The QERI Index declined for the second consecutive day and fell
sharply by -2.95% to settle at 4,315.13. The index made a weak start
and remained in a bearish mode throughout the day, showing no
signs of recovery. Moreover, the index penetrated below the levels of
4,400.0 and 4,350.0 in a single trading session due to sustained
selling pressure. On the downside, the index has support near
4,300.0; however, a dip below this level may be a bearish sign.
Masraf Al Rayan: Short-Term – Pullback
MARK reversed and penetrated below the key supports of QR55.80
and QR54.0 in a single swoop, which is a negative sign. We believe
although the stock is trading close to its immediate support of the 55-
day moving average, it may not hold onto it and decline further to test
the 21-day moving average. However, if the stock manages to climb
above QR54.0, it may attract buyers. Meanwhile, the negative slope
on the RSI indicates a likely downmove.
Doha Bank: Short-Term – Pullback
DHBK continued to drift lower on Thursday and moved below the
support of QR56.50 on the back of large volumes. Moreover, the
stock has been experiencing sustained selling pressure since failing
to move above the 55-day moving average. Further, both the
momentum indicators are pointing down, indicating the weakness to
continue. Traders may consider selling the stock at the current level
for a target of QR55.50 with a strict stop loss of QR56.50.
Ooredoo: Short-Term – Pullback
ORDS dipped below the 21-day moving average on Wednesday and
declined further below the support of QR129.70 on Thursday,
indicating a continuation of this pullback. Moreover, the stock has
been facing stiff resistance from the descending trendline over the
past few days. Further, both the momentum indicators are providing
bearish signals. We believe the stock may drift down further to test
QR126.0. However, a close above QR129.70 may be a positive sign.
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
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.
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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) 12,952.82 UP UP 12,939.80 12,900.00 13,000.00 13,079.52
Al Rayan Islamic Index (QERI Index) 4,315.13 UP UP 4,301.89 4,247.34 4,341.10 4,400.00
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD)* 53.60 UP FLAT 52.50 51.80 54.00 55.80
Commercial Bank of Qatar (CBQK QD) 68.20 UP UP 67.30 66.50 68.30 69.50
Doha Bank (DHBK QD)* 56.20 DOWN DOWN 55.50 54.40 56.50 57.40
Qatar Islamic Bank (QIBK QD) 103.00 UP UP 102.00 100.00 104.50 107.00
Qatar International Islamic Bank (QIIK QD) 83.00 DOWN DOWN 81.50 80.70 83.50 85.00
Qatar Insurance (QATI QD) 90.50 UP UP 88.90 87.30 91.00 92.40
Al Khalij Commercial Bank (KCBK QD) 22.50 UP FLAT 22.35 21.87 22.60 23.00
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 100.90 UP UP 100.00 98.50 101.30 104.50
Al Meera Consumer Goods Co. (MERS QD) 181.00 UP UP 179.00 175.00 181.60 183.00
Industries Qatar (IQCD QD) 174.90 DOWN DOWN 173.00 171.50 175.50 178.30
Qatar Electricity & Water Co. (QEWS QD)* 185.50 UP FLAT 184.00 182.00 187.00 188.90
Gulf International Services (GISS QD) 114.90 UP UP 111.90 109.00 116.00 119.50
Qatari Investors Group (QIGD QD) 51.30 DOWN DOWN 51.00 49.75 52.40 54.00
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 40.45 FLAT FLAT 39.70 39.20 41.00 41.80
United Development Co. (UDCD QD) 27.95 UP UP 27.20 26.45 28.50 29.35
Ooredoo (ORDS QD)* 128.00 DOWN DOWN 126.00 123.70 129.70 132.00
Vodafone Qatar (VFQS QD) 19.01 UP DOWN 18.75 17.99 19.29 20.00
Nakilat (QGTS QD) 23.40 UP FLAT 23.00 22.45 23.60 24.12
Milaha (QNNS QD) 92.00 DOWN DOWN 92.00 91.30 93.90 95.10