TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Upmove
Al Rayan Islamic Index: Short-Term – Neutral
Qatar International Islamic Bank: Short-Term – Upswing
The QE Index continued its relentless rally and gained around 25
points (0.22%), tagging another new 52-week high. The index
respected the support of the ascending trendline and rebounded
around 101 points from its day’s low of 10,974.71, as bulls continued
their domination. We believe the index may continue its upward
momentum and approach 11,100.0, as it has strong support from
both the momentum indicators, which are in uptrend mode.
The QERI Index rebounded and gained around 0.34% to close the
session at 3,229.56. The index, which witnessed profit-booking on
Tuesday, continued its upmove and advanced near the ascending
trendline. We believe the index may continue to proceed ahead
toward the ascending trendline near 3,250.0 until it clings on to its
support near 3,200.0. Meanwhile, the RSI is stalling, while the MACD
is moving higher from the signal line.
QIIK after consolidating just for a single day on Tuesday continued its
strong rally tagging a new 52-week high. We believe the stock has
been in uptrend mode and may continue to tag a new 52-week high.
Moreover, the RSI is trending strongly in the overbought territory,
while the MACD is widening further away from the signal line in a
bullish manner. However, traders may need to keep a close watch on
QR69.40 for any reversal signs.
Nakilat: Short-Term – Breakout
Industries Qatar: Short-Term – Upswing
Gulf International Services: Short-Term – Upswing
QGTS cleared the resistance of QR21.07 for the first time since
November. Moreover, the RSI is growing stronger, while the MACD is
diverging in the bullish territory indicating a likely higher move. We
believe the stock is in upmove mode since clearing the 21-day
moving average and may now march toward the QR21.32 level. A
breach above this level may spark additional buying interest toward
QR21.44. However, a dip below QR21.07 may result in consolidation.
IQCD continued its upmove and surpassed the long-term ascending
trendline tagging another new 52-week high suggesting continuation
of this upmove. We believe the stock has been trending strongly and
gaining strength since clearing the 21-day moving average and may
continue to tag new 52-week highs. Moreover, the RSI and the
MACD lines are providing bullish signals indicating that the stock has
enough steam to accelerate further.
GISS continued its bullish momentum tagging another new all-time
high. Moreover, the bullishness in the RSI is intact, while the MACD is
diverging away from the signal line and is rising up indicating that the
stock is poised to tag new highs. We believe the stock may continue
to advance and tag new highs until it trades above the support of the
ascending trendline. However, a dip below QR71.30 may result in
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Qatar Exchange Index (QE Index)
Al Rayan Islamic Index (QERI Index)
Masraf Al Rayan (MARK QD)
Commercial Bank of Qatar (CBQK QD)
Doha Bank (DHBK QD)
Qatar Islamic Bank (QIBK QD)
Qatar International Islamic Bank (QIIK QD)*
Qatar Insurance (QATI QD)
National Leasing Holding Co. (NLCS QD)
Widam Food Co. (WDAM QD)
Al Meera Consumer Goods Co. (MERS)
Industries Qatar (IQCD QD)*
Qatar Electricity & Water Co. (QEWS QD)
Gulf International Services (GISS QD)*
Qatari Investors Group (QIGD QD)
Barwa Real Estate Co. (BRES QD)
United Development Co. (UDCD QD)
Ooredoo (ORDS QD)
Vodafone Qatar (VFQS QD)
Nakilat (QGTS QD)*
Milaha (QNNS QD)
Banks and Financial Services
Consumer Goods and Services
*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
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.
Simple Moving Average (SMA): A SMA is the average of the closing price of a security for a given period.
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.
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.
Ahmed M. Shehada
QNB Financial Services SPC
Head of Research
Tel: (+974) 4476 6534
Head of Trading
Tel: (+974) 4476 6535
Head of Sales
Tel: (+974) 4476 6533
Manager - HNWI
Tel: (+974) 4476 6544
Contact Center: (+974) 4476 6666
PO Box 24025
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