10 June Daily technical trader


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10 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 extended its losses for the second straight session and shed around 180 points (-1.37%). Moreover, the index slipped below the 13,100.0 & 13,000.0 levels in a single swoop as sustained selling pressure pulled it lower. The index has its immediate defendable support near 12,940.0. However, traders may witness a further sell- off if the index fails to hold onto 12,940.0. Conversely, the bias may become bullish if the index closes above 13,020.0. Masraf Al Rayan: Short-Term – Pullback MARK has been drifting lower along the descending trendline over the past few days and further breached its supports of QR57.30 and the 21-day moving average in a single swoop. Notably, volumes were also large on the decline which is a negative sign. Moreover, both the momentum indicators are providing bearish signals. Thus, traders could consider selling this stock at the current level with a target price of QR52.30 with a strict stop loss of the QR55.75 level. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index continued its decline for the second consecutive day and fell -1.46% to close the session at 4,365.69. Moreover, the index breached 4,400.0 along with the 21-day moving average and caved under heavy selling pressure. We believe the index may continue to drift lower and test its immediate support of 4,341.10. Any sustained weakness below this level may drag the index further down toward 4,300.0. However, a close above 4,400.0 may trigger buying interest. Qatar Electricity & Water Co.: Short-Term – Pullback QEWS failed to make any further headway above QR190.0 and dipped below its support of QR188.0 yesterday. Moreover, the stock has been in declining mode since topping the rally at QR208.70 and is registering losses. Meanwhile, with both the momentum indicators pointing lower, QEWS’ preferred direction seems to be on the downside. We believe the stock may test QR185.0, followed by the QR184.35 level. However, a close above QR188.0 may be positive. Qatar Insurance: Short-Term – Upmove QATI continued its upward momentum and did not weaken even after market turbulence, which is a positive signal. Moreover, the stock formed a sizable bullish candlestick on the daily charts, indicating a likely continuation of this upmove. Thus, the prognosis of this time implies a further upside and could test QR81.40. Meanwhile, the RSI and the MACD lines are moving up in a bullish manner with no trend reversal signs. However, a dip below QR80.50 may halt its upmove. Ooredoo: Short-Term – Pullback ORDS continued its decline and further penetrated below its supports of the 21-day moving average and QR149.0 in a single trading session on the back of large volumes. We believe this strong breach of supports has bearish implications and provides a downside target of QR147.40, which is also in proximity to the 55-day moving average. However, if the stock manages to reclaim QR149.0 it may provide some relief. Meanwhile, both the indicators look weak.
  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) 12,969.65 DOWN UP 12,939.80 12,850.00 13,019.55 13,100.00 Al Rayan Islamic Index (QERI Index) 4,365.69 DOWN UP 4,341.10 4,301.89 4,400.00 4,444.86 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 55.00 DOWN UP 52.30 51.80 57.30 59.90 Commercial Bank of Qatar (CBQK QD) 65.90 DOWN DOWN 65.75 64.92 67.30 68.40 Doha Bank (DHBK QD) 61.00 DOWN DOWN 61.00 59.90 62.00 63.00 Qatar Islamic Bank (QIBK QD) 98.00 DOWN UP 96.00 93.90 98.50 100.00 Qatar International Islamic Bank (QIIK QD) 85.40 DOWN UP 83.00 80.70 86.10 87.80 Qatar Insurance (QATI QD)* 80.90 UP UP 80.50 79.00 81.40 83.00 Al Khalij Commercial Bank (KCBK QD) 23.10 DOWN FLAT 22.90 22.50 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 83.90 DOWN UP 83.00 81.70 85.00 87.80 Al Meera Consumer Goods Co. (MERS QD) 181.50 DOWN UP 180.00 175.00 183.00 185.00 Industrials Industrials Industries Qatar (IQCD QD) 180.50 DOWN DOWN 180.00 178.30 181.40 182.50 Qatar Electricity & Water Co. (QEWS QD)* 186.80 DOWN UP 185.00 182.00 188.00 190.00 Gulf International Services (GISS QD) 90.00 DOWN DOWN 90.00 86.60 91.40 93.00 Qatari Investors Group (QIGD QD) 62.30 DOWN DOWN 61.30 59.70 62.40 64.70 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 42.00 UP UP 41.40 41.00 43.00 44.50 United Development Co. (UDCD QD) 25.95 DOWN UP 25.50 25.29 26.00 26.45 Telecom Telecom Ooredoo (ORDS QD)* 148.50 DOWN UP 147.40 145.00 149.00 151.00 Vodafone Qatar (VFQS QD) 19.87 FLAT UP 19.29 18.75 20.00 20.79 Transportation Transportat Nakilat (QGTS QD) 23.60 DOWN UP 23.40 22.45 23.90 24.20 Milaha (QNNS QD) 91.40 DOWN DOWN 91.20 90.20 93.10 95.10