14 January Daily technical trader


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14 January Daily technical trader

  1. 1. TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove Al Rayan Islamic Index: Short-Term – Upmove Masraf Al Rayan: Short-Term – Breakout The QE Index continued its upward momentum and gained around 98 points (0.89%), tagging another new 52-week high to close at 11,019.86. Moreover, the volumes were also large supporting the index’s higher move indicating rising buying interest. We believe the index is trending strong and may maintain its higher wave toward the 11,050.0-11,100.0 levels. Meanwhile, both momentum indicators are in uptrend mode with no immediate trend reversal signs. The QERI Index tagged another new all-time high, surpassing its previous high of 3,202.18 as bulls continued their domination over the bears. The index has been aggressively moving higher over the past few days and may continue to advance, tagging new highs. Moreover, the index developed a bullish Marubozu candle pattern indicating a likely move ahead. Meanwhile, the bullishness in the RSI is intact, while the MACD is rising further up from the signal line. MARK cleared the resistance of QR34.15 for the first time since December. The next obstacle the stock faces is at QR35.0. The recent price action and rising volumes suggest that potential buyers are stepping in. We believe the current higher push has enough steam to test and surpass QR35.0, targeting QR36.0. Moreover, both indicators are providing bullish signals supporting a further rise. However, a retreat below QR34.15 may indicate a false breakout. Milaha: Short-Term – Breakout Doha Bank: Short-Term – Breakout Qatar International Islamic Bank: Short-Term – Upswing QNNS breached the resistance of QR91.30 and tagged a 52-week high. Notably, volumes were also large on the breakout, which is a positive sign. We believe the stock has been steadily moving higher over the past few days and is gaining strength. Meanwhile, with the RSI moving strongly in the overbought territory, and the MACD moving further up from the signal line, QNNS is poised to tag new 52week highs, thus supporting our bullish outlook. DHBK respected the support near the ascending trendline and rebounded to surpass the resistance of QR63.30. Moreover, the stock developed a bullish Marubozu candle pattern, which usually indicates that the downmove could be over. With volumes also picking up, it seems DHBK may be ready for an advance toward QR63.90. Meanwhile, both RSI and MACD lines suggest strength for an upmove. However, a decline below QR63.30 may halt its upmove. QIIK continued its bullish rally and tagged another new 52-week high yesterday. The stock has been in uptrend mode and is relentlessly tagging new highs. Moreover, the RSI is trending higher, while the MACD is diverging away from the signal line in a bullish manner indicating that QIIK has enough steam to accelerate further. In addition, the stock developed a bullish Marubozu candle pattern indicating that this rally may not fizzle out soon. Page 1 of 2
  2. 2. Name (Ticker) Last Close Trend Short Term Support Long Term First Resistance Second First Second Qatar Exchange Index (QE Index) 11,019.86 UP UP 10,950.00 10,900.00 11,100.00 11,170.00 Al Rayan Islamic Index (QERI Index) 3,228.51 UP UP 3,199.21 3,151.22 3,250.00 3,300.00 Masraf Al Rayan (MARK QD)* 34.80 UP UP 34.15 33.50 35.00 36.00 Commercial Bank of Qatar (CBQK QD) 74.10 UP UP 73.30 72.80 74.50 75.00 Doha Bank (DHBK QD)* 63.60 UP UP 63.30 62.00 63.90 64.50 Qatar Islamic Bank (QIBK QD) 75.90 UP UP 75.70 75.00 77.00 77.50 Qatar International Islamic Bank (QIIK QD)* 69.40 UP UP 68.00 67.25 70.00 70.75 Qatar Insurance (QATI QD) 71.50 UP UP 71.00 70.00 72.50 73.15 National Leasing Holding Co. (NLCS QD) 30.90 UP UP 30.60 30.00 31.45 31.80 Widam Food Co. (WDAM QD) 53.10 DOWN UP 53.00 51.90 54.00 54.70 Al Meera Consumer Goods Co. (MERS) 145.30 UP UP 145.00 142.70 148.00 150.00 Industries Qatar (IQCD QD) 174.90 UP UP 174.20 173.00 175.10 176.00 Qatar Electricity & Water Co. (QEWS QD) 183.00 UP UP 181.60 180.00 184.00 185.00 Gulf International Services (GISS QD) 68.80 UP UP 67.00 66.20 68.80 69.40 Qatari Investors Group (QIGD QD) 51.40 UP UP 49.50 47.70 52.40 56.20 Barwa Real Estate Co. (BRES QD) 30.90 UP UP 30.85 30.50 31.20 31.90 United Development Co. (UDCD QD) 23.15 UP UP 22.85 22.50 23.35 23.50 Ooredoo (ORDS QD) 142.10 UP UP 141.50 139.90 143.00 145.00 Vodafone Qatar (VFQS QD) 11.30 UP UP 11.19 11.00 11.44 11.60 Nakilat (QGTS QD) 20.74 DOWN UP 20.35 20.00 21.07 21.32 Milaha (QNNS QD)* 92.90 UP UP 91.30 90.00 94.00 95.00 Banks and Financial Services Banks and Consumer Goods and Services Consumer G Industrials Industrials Real Estate Real Estate Telecom Telecom Transportation Transportat *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 55day 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. Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Tel: (+974) 4476 6534 saugata.sarkar@qnbfs.com.qa Head of Trading Tel: (+974) 4476 6535 ahmed.shehada@qnbfs.com.qa Head of Sales Tel: (+974) 4476 6533 keith.whitney@qnbfs.com.qa Manager - HNWI Tel: (+974) 4476 6544 sahbi.alkasraoui@qnbfs.com.qa Contact Center: (+974) 4476 6666 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