13 March Daily technical trader


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13 March Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Downmove The QE Index slipped for the second straight session and fell around 160 points (-1.39%), penetrating below the 11,500.0 and 11,400.0 psychological levels in a single swoop. The index momentarily moved above the 11,520.55 level, but failed to sustain above it, drifting lower as bears took charge and overpowered the bulls. Traders may now watch out for a test of 11,338.41, as a dip below this level may trigger more selling pressure and pull the index further down. Doha Bank: Short-Term – Downmove DHBK caved under selling pressure and breached its supports of QR58.20 and QR57.40 in a single swoop. The stock developed a bearish Marubozu candle pattern indicating the continuation of this downmove. We believe the stock may move further down and test its immediate support at QR56.20. However, a move above QR57.40 may halt its downmove. Meanwhile, both the indicators are growing more bearish with no immediate trend reversal signs. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index snapped its four-day winning streak and declined by -0.51% to close the session at 3,419.77. The index tagged a new all- time high of 3,458.51, but later retreated in the day as there was exhaustion on the part of buyers. We believe bulls are still in control until the index trades above its immediate support near 3,410.0 and may continue to advance. However, any retreat below 3,410.0 may drag the index to test the 3,382.68 level. Vodafone Qatar: Short-Term – Upmove VFQS cleared the resistance of the descending trendline at QR11.90, which had restricted its bullish move in the past. The stock is once again approaching toward its next resistance of QR12.09. If VFQS can breach this level, it may confirm this bullish move targeting the 21-day moving average. However, a drop below QR11.90 may lead to a decline and a test of QR11.60. The RSI has rejected the mid-line and is moving up indicating the possibility of a further rise. Milaha: Short-Term – Downmove QNNS witnessed a gap-up opening but failed to hold onto to it, continuing its decline. The stock has been in downmove mode since developing a double top candle pattern. Moreover, with both the indicators in downtrend mode, the stock is likely to drift further down and test the QR91.30 level. Any sustained weakness below this level may pull the stock further down and test its 55-day moving average. However, a close above QR93.0 may provide some relief. Commercial Bank of Qatar: Short-Term – Downmove CBQK penetrated below the support of QR76.40 on the back of large volumes, which is a negative sign. Moreover, the stock has been moving along the descending trendline over the past few days and has failed to move above it. The prognosis of this time frame implies more downside with the RSI drifting lower toward the mid-line and the MACD growing more bearish. We believe the stock may continue to weaken further and test QR75.30, followed by the QR75.11 level.
  2. 2. Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Trading Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6535 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa ahmed.shehada@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) 11,349.17 DOWN UP 11,338.41 11,171.33 11,400.00 11,484.45 Al Rayan Islamic Index (QERI Index) 3,419.77 UP UP 3,409.71 3,382.68 3,432.26 3,458.51 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 38.40 FLAT UP 38.00 36.55 39.10 40.00 Commercial Bank of Qatar (CBQK QD)* 75.70 UP UP 75.30 74.00 76.40 77.00 Doha Bank (DHBK QD)* 57.00 DOWN DOWN 56.20 55.20 58.20 60.00 Qatar Islamic Bank (QIBK QD) 74.00 DOWN DOWN 73.30 72.80 75.00 76.00 Qatar International Islamic Bank (QIIK QD) 73.50 DOWN UP 72.80 71.50 74.40 75.10 Qatar Insurance (QATI QD) 62.80 DOWN UP 62.56 60.96 64.00 66.90 National Leasing Holding Co. (NLCS QD) 28.55 DOWN DOWN 28.50 28.00 29.15 29.95 Consumer Goods and Services Consumer G Widam Food Co. (WDAM QD) 42.30 DOWN DOWN 42.30 41.90 44.50 45.90 Al Meera Consumer Goods Co. (MERS) 162.10 UP UP 159.00 154.90 164.00 165.00 Industrials Industries Qatar (IQCD QD) 178.00 DOWN DOWN 175.00 173.00 180.00 182.50 Qatar Electricity & Water Co. (QEWS QD) 170.00 DOWN UP 168.00 165.36 170.91 174.36 Gulf International Services (GISS QD) 93.50 UP UP 91.80 88.00 94.00 96.00 Qatari Investors Group (QIGD QD) 51.10 UP DOWN 49.75 47.70 52.40 56.20 Real Estate Barwa Real Estate Co. (BRES QD) 32.55 UP UP 32.00 31.60 33.25 34.00 United Development Co. (UDCD QD) 21.80 DOWN DOWN 21.70 21.50 22.00 22.50 Telecom Ooredoo (ORDS QD) 139.00 DOWN DOWN 138.50 136.00 139.90 141.00 Vodafone Qatar (VFQS QD)* 11.99 DOWN UP 11.90 11.60 12.09 12.40 Transportat Nakilat (QGTS QD) 21.40 DOWN UP 20.90 20.50 21.83 22.19 Milaha (QNNS QD)* 92.00 DOWN UP 91.30 90.00 93.00 95.10