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16 July Daily technical trader


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16 July Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove The QE Index continued its uptrend, gaining 0.85% to close at 13,100.44. The index broke its psychological level of 13,000.0 and closed marginally above its resistance level of 13,100. Both the technical indicators are positive, suggesting a likely continuation of this uptrend in the short-term. The next resistance for the index is seen near the 13,196 level, after which the index can test the 13,321 level. On the downside, 13,070 may act as an immediate support. Al Khalij Commercial Bank: Short-Term – Pull back KCBK fell 1.37% to close at QR22.29. The stock is facing stiff resistance from its 55-day moving average (QR22.56). KCBK is forming a rounding top pattern on the charts. The RSI and the MACD also seem to have formed a top and beginning to move lower. The stock is likely to test the support at its 21-day moving average (QR21.58), below which it can move toward QR21.20. However, a close above the QR23.0 level would suggest a bullish trend. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index jumped 1.31% (56.57 points) to close at 4,373.17. The index ended the day at the highest point, which is a positive sign. Both the technical indicators are trending higher, supporting the bullish view. The QERI Index is likely to test its resistance level of 4,445 in the coming days. Above this, the index can move toward the 4,500 level mark. On the flipside, a close below its 55-day moving average (4,267.87) would be a bearish signal. Gulf International Services: Short-Term – Upmove After 10 consecutive days of gains, GISS witnessed some profit booking on Tuesday to close at QR108.50, down 0.46%. However, the stock remains in an uptrend both in the short and long-term. The MACD continues to diverge on the upside, while the RSI has flattened into the overbought zone after yesterday’s correction. The stock is likely to move higher toward QR120. However, investors should exercise caution if GISS closes below the QR101.50 level. Barwa Real Estate Co.: Short-Term – Upmove BRES has recovered sharply over the last couple of weeks. The stock gained 3.01% on Tuesday on relatively high volumes. The RSI and the MACD are trending higher, providing a positive signal. The stock formed a bullish Marubozu candle pattern, indicating it may move higher from the current levels. BRES has an immediate resistance at QR43.20, above which it can test QR45.0 level. However, investors should exercise caution if the stock falls to close below QR41.80. Qatari Investors Group: Short-Term – Pull Back QIGD slipped 1.23% to close at QR56.10. The stock has tested its resistance of QR57.0 on several occasions, but has been unable to rise above it. On Tuesday, the stock fell below its 21-day moving average (at QR56.27). The RSI has started to move lower, while the MACD has converged with the signal line. QIGD is likely to fall further toward QR54.40, below which it can test the QR52.50 level. On the flipside, a close above QR57.0 would be a bullish sign.
  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) 13,100.44 UP FLAT 13,079.52 12,939.80 13,195.88 13,320.89 Al Rayan Islamic Index (QERI Index) 4,373.17 UP FLAT 4,350.00 4,311.42 4,444.86 4,528.58 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 54.50 UP UP 54.00 52.60 55.20 57.30 Commercial Bank of Qatar (CBQK QD) 70.00 UP FLAT 69.50 68.30 70.00 70.70 Doha Bank (DHBK QD) 58.90 DOWN DOWN 58.10 57.40 59.00 60.00 Qatar Islamic Bank (QIBK QD) 107.00 UP UP 104.50 102.00 111.00 115.00 Qatar International Islamic Bank (QIIK QD) 86.70 UP UP 86.10 85.00 88.00 88.50 Qatar Insurance (QATI QD) 90.90 UP UP 88.90 87.70 90.90 92.40 Al Khalij Commercial Bank (KCBK QD)* 22.29 UP UP 21.87 21.58 22.35 22.60 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 90.00 UP UP 89.80 89.00 90.50 92.50 Al Meera Consumer Goods Co. (MERS QD) 181.60 UP DOWN 177.50 175.00 181.60 186.00 Industrials Industrials Industries Qatar (IQCD QD) 179.00 UP DOWN 175.50 171.00 181.40 182.50 Qatar Electricity & Water Co. (QEWS QD) 189.00 UP DOWN 188.90 186.28 191.50 193.00 Gulf International Services (GISS QD)* 108.50 UP UP 104.50 101.50 112.0 120.00 Qatari Investors Group (QIGD QD)* 56.10 DOWN DOWN 54.40 52.50 57.00 60.60 Real Estate Real Estate Barwa Real Estate Co. (BRES QD)* 42.75 UP UP 42.50 41.80 43.20 45.00 United Development Co. (UDCD QD) 25.45 UP UP 25.30 24.75 26.00 26.45 Telecom Telecom Ooredoo (ORDS QD) 134.90 UP DOWN 133.90 131.50 136.00 138.00 Vodafone Qatar (VFQS QD) 19.43 UP UP 19.30 18.75 20.00 20.78 Transportation Transportat Nakilat (QGTS QD) 23.10 DOWN DOWN 23.00 22.45 23.60 24.12 Milaha (QNNS QD) 97.60 UP UP 96.50 95.10 98.00 99.00