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11 August Daily technical trader


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11 August 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 marginally and ended the volatile session in red for the third straight session. However, the index managed to stay above the 13,050.0 level, which is a positive development. Further, traders should keep a close watch on the 13,050.0 level, as any dip below this level on a closing basis could drag the index. On the flip side, the index may bounce back if it manages to cling onto 13,050.0. Meanwhile, both the momentum indicators are stalling. Medicare Group: Short-Term – Bounce Back MCGS respected the support of QR118.20 and surged 5.48% on the back of large volumes. Moreover, the stock wiped away majority of its losses it witnessed over the past two days. We believe the current higher push has enough steam to test QR126.50. Any move above this level may spark additional buying interest and push the stock further to test QR128.80. Meanwhile, both the indicators are providing bullish signals. However, a dip below QR121.50 may pull the stock. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index gained by 0.50% to close the session above the 4,500.0 mark. Meanwhile, the index is currently wedged between 4,529.0 on the higher side and 4,445.0 on the lower side, and is moving sideways over the past few days. We believe a close above 4,529.0 may see the bulls go berserk, which may lead to a higher move in the index. Conversely, any failure to move above the 4,529.0 level may result in a range-bound movement. Gulf International Services: Short-Term – Upmove GISS cleared the important resistance of the ascending triangle at QR118.10 yesterday. Moreover, the stock developed a bullish Marubozu candlestick pattern indicating a likely continuation of this upmove. Further, the RSI is moving strongly in the overbought territory indicating the possibility of a higher move. Thus, traders could consider buying the stock at the current level and on declines up to QR118.50 for a target of QR119.50 with a stop loss of QR118.10. Qatar Insurance: Short-Term –Upmove QATI cleared the important resistance of the ascending triangle at QR92.40 after feigning a failure over the past few days, which is a positive signal. Notably, the spike in volumes is indicating increased optimism among traders. We believe the stock may advance further and test QR94.80. However, any retreat below QR92.40 may drag the stock back into the congestion zone. Meanwhile, the RSI, which is in the buy zone, is supporting this bullish sentiment. Milaha: Short-Term – Upmove QNNS continued its bullish momentum for the third consecutive day and gained 1.70%. Moreover, the stock breached its resistances of the 21-day moving average and QR95.10 in a single swoop. Further, both the momentum indicators are pointing higher indicating that the rally may continue. We believe the stock may extend its gains and advance further to test QR96.50. However, any decline below QR95.10 may halt its upmove.
  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 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) 13,075.43 UP UP 13,000.00 12,939.80 13,079.52 13,195.88 Al Rayan Islamic Index (QERI Index) 4,500.20 UP UP 4,444.86 4,375.30 4,528.58 4,638.81 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 53.90 FLAT FLAT 52.50 49.75 54.00 55.80 Commercial Bank of Qatar (CBQK QD) 67.00 DOWN FLAT 66.50 65.90 67.30 68.30 Doha Bank (DHBK QD) 57.00 DOWN DOWN 56.50 55.50 57.40 58.90 Qatar Islamic Bank (QIBK QD) 109.00 UP UP 107.00 104.50 109.50 111.90 Qatar International Islamic Bank (QIIK QD) 84.90 DOWN UP 83.50 82.80 85.00 86.10 Qatar Insurance (QATI QD)* 92.50 UP UP 92.40 91.00 94.80 96.00 Al Khalij Commercial Bank (KCBK QD) 22.05 DOWN DOWN 21.99 21.80 22.35 22.60 Consumer Goods and Services Consumer G Medicare Group (MCGS QD)* 125.20 UP UP 121.50 118.20 126.50 128.80 Al Meera Consumer Goods Co. (MERS QD) 191.50 UP UP 190.00 187.80 194.80 196.00 Industrials Industrials Industries Qatar (IQCD QD) 170.20 DOWN DOWN 169.50 167.80 172.30 173.90 Qatar Electricity & Water Co. (QEWS QD) 184.00 DOWN DOWN 184.00 182.00 186.00 188.00 Gulf International Services (GISS QD)* 118.70 UP UP 118.20 115.00 119.50 122.00 Qatari Investors Group (QIGD QD) 57.20 UP DOWN 56.20 54.20 57.70 60.60 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 39.25 DOWN DOWN 38.40 37.50 39.70 40.10 United Development Co. (UDCD QD) 29.95 UP UP 29.90 29.30 30.61 31.93 Telecom Telecom Ooredoo (ORDS QD) 128.50 DOWN DOWN 126.00 123.70 129.70 131.50 Vodafone Qatar (VFQS QD) 19.50 FLAT FLAT 19.29 18.75 20.00 20.78 Transportation Transportat Nakilat (QGTS QD) 24.80 UP UP 24.45 24.12 25.30 25.90 Milaha (QNNS QD)* 95.50 UP UP 93.00 92.00 94.50 95.10