14 July Daily technical trader


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14 July 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 snapped its four-day winning streak and shed around 38 points (-0.29%) to close below the 12,900.0 mark. The index witnessed a strong opening and tested the psychological level of 13,000.0, but reversed later in the day as traders opted to book profits. Meanwhile, the index needs to clear its resistance near 12,940.0 and sustain above it in order to proceed ahead. Conversely, any failure to move above 12,940.0 may result in consolidation. Barwa Real Estate Co.: Short-Term – Pullback BRES retreated below the QR41.0 level yesterday after witnessing gains over the past few days. The stock developed a bearish piercing candlestick pattern on daily charts, which usually indicates a pullback. Further, the negative slope on the RSI suggests that the stock may be due for a correction. Thus, traders may consider selling the stock at the current level for a target of QR40.10 with a strict stop loss at the QR41.0 level. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index halted its gains and fell by -0.52% on the back of profit-booking. The index started the day on a positive note and momentarily moved above the 4,350.0 level. However, the index could not hold on to its gains and retreated, as the bears took charge and pulled it down. We believe until the index stays above the 55-day moving average (4,262.07) the bulls need not worry. However, traders may exercise caution if the index declines below 4,262.07. Gulf International Services: Short-Term – Uptrend GISS advanced 1.46% and tagged a new high yesterday. The stock has been in an uptrend mode, registering strong gains over the past few days. Moreover, both the momentum indicators are growing bullish and are showing no immediate trend reversal signs. Hence, traders may expect the stock to continue its positive momentum to record new highs. However, traders may need to closely watch on QR103.50, as any dip below this level may halt its uptrend. Nakilat: Short-Term – Upmove QGTS gained 1.57% and cleared the resistance of QR22.45 on the back of increased participation. The stock has been advancing over the past few days and has shown strength. Moreover, with both the momentum indicators providing bullish signals, QGTS’ preferred direction is on the upside. Traders could consider buying the stock at the current level for a target of QR23.0, followed by the 55-day moving average with a stop loss of the QR22.45 level. Vodafone Qatar: Short-Term – Pullback VFQS failed to make any further headway above QR19.30 and retreated, as the buyers backed away from higher price. Moreover, the stock developed a shooting star candlestick pattern on daily charts, indicating a continuation of this pullback. We believe the stock may slip down further and test QR18.75, which is also in proximity to the 55-day moving average. However, if the stock manages to move above the QR19.30 level, it may likely attract buyers.
  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) 12,881.70 UP UP 12,768.17 12,678.84 12,939.80 13,079.52 Al Rayan Islamic Index (QERI Index) 4,304.65 UP UP 4,247.34 4,211.12 4,311.42 4,350.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 54.60 UP UP 54.00 52.60 55.20 57.30 Commercial Bank of Qatar (CBQK QD) 68.00 UP UP 67.40 65.75 68.30 69.50 Doha Bank (DHBK QD) 58.00 UP DOWN 57.40 56.50 58.10 59.00 Qatar Islamic Bank (QIBK QD) 100.00 UP UP 99.50 98.30 101.83 102.36 Qatar International Islamic Bank (QIIK QD) 86.50 UP UP 86.10 85.00 88.00 88.50 Qatar Insurance (QATI QD) 87.00 UP UP 87.00 85.50 87.70 88.50 Al Khalij Commercial Bank (KCBK QD) 22.60 UP FLAT 22.35 22.00 22.60 23.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 87.20 UP UP 86.00 85.10 87.80 89.80 Al Meera Consumer Goods Co. (MERS QD) 176.50 UP DOWN 175.00 173.89 177.50 180.00 Industrials Industrials Industries Qatar (IQCD QD) 177.00 UP DOWN 175.50 173.00 178.30 180.00 Qatar Electricity & Water Co. (QEWS QD) 188.00 UP UP 186.50 185.20 188.90 191.50 Gulf International Services (GISS QD)* 104.00 UP UP 103.50 101.50 104.50 106.00 Qatari Investors Group (QIGD QD) 57.00 FLAT DOWN 56.10 54.40 57.00 60.60 Real Estate Real Estate Barwa Real Estate Co. (BRES QD)* 40.75 UP UP 40.10 39.75 41.00 41.80 United Development Co. (UDCD QD) 25.40 UP FLAT 25.30 24.75 26.00 26.25 Telecom Telecom Ooredoo (ORDS QD) 134.00 UP DOWN 133.90 131.50 136.00 137.60 Vodafone Qatar (VFQS QD)* 19.11 FLAT FLAT 18.75 18.00 19.30 20.00 Transportation Transportat Nakilat (QGTS QD)* 22.65 UP DOWN 22.45 22.19 23.00 23.60 Milaha (QNNS QD) 96.50 UP UP 95.10 93.00 96.50 98.30