16 June Daily technical trader


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16 June 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 witnessed a gap-down opening and remained in bearish mode throughout the day declining around 206 points (- 1.58%). The index breached the 12,900.0 and 12,800.0 levels along with the 55-day moving average in a single swoop, as sustained selling pressure dragged it lower. Meanwhile, the index is trading close to 12,750.0. If the index manages to hold onto this level on a closing basis, it may attempt to rebound or retreat further. Industries Qatar: Short-Term – Pullback IQCD witnessed a gap down opening, and further dipped below its important support of QR180.0 yesterday. Moreover, the stock has been experiencing steady decline since moving below the 55-day moving average. Meanwhile, the stock ended up in developing a bearish candlestick formation on the daily charts indicating a further downside. Thus, traders could consider selling the stock at the current level with a strict stop loss of QR180.0. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index failed to make any further headway above 4,350.0 and fell by -1.32% to settle below the 4,300.0 level. The index made a weak start to the day and penetrated below the important support of 4,301.89 caving under sustained selling pressure. Meanwhile, the index needs to reclaim 4301.89 in order to keep its upward hopes alive. Any failure to move above 4,301.89 on a closing basis may result in further weakness and pull the index lower to test 4,250.0. Qatar Insurance: Short-Term – Rebound QATI found support at the ascending trendline and the 21-day moving average and rebounded gaining 1.01%. Moreover, the stock developed a sizable bullish candlestick on the daily charts indicating a likely advance. Further, both momentum indicators are in the buy zone, supporting this bullish sentiment. Thus, traders could consider buying the stock at the current level and on declines. Barwa Real Estate Co.: Short-Term – Pullback BRES has been drifting lower over the past few days and further penetrated below the supports of the 21-day moving average & the descending triangle at QR41.0. However, the stock is trading close to its ascending trendline support of QR40.40. Any dip below this level may result in additional selling pressure, which may pull the stock to test QR39.70. However, a close above QR41.0 may halt its pullback. Meanwhile, both indicators are providing bearish signals. Vodafone Qatar: Short-Term – Pullback VFQS continued its declining mode & breached its supports of QR20.0 and the 21-day moving average in a single swoop. Moreover, the stock developed a bearish Marubozu candlestick pattern indicating a likely continuation of this pullback. We believe the stock may continue to drift lower and test QR19.29. However, if the stock reclaims the 21-day moving average on a closing basis it may provide some relief. Meanwhile, both indicators are looking weak.
  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) 12,773.20 DOWN DOWN 12,768.17 12,678.84 12,850.00 12,939.80 Al Rayan Islamic Index (QERI Index) 4,283.58 DOWN UP 4,247.34 4,200.00 4,301.89 4,341.10 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 53.20 DOWN UP 52.30 51.80 55.00 57.30 Commercial Bank of Qatar (CBQK QD) 64.70 DOWN DOWN 64.15 63.60 64.92 65.75 Doha Bank (DHBK QD) 60.00 DOWN DOWN 59.00 58.20 61.00 62.00 Qatar Islamic Bank (QIBK QD) 96.00 DOWN UP 96.00 93.90 98.50 100.00 Qatar International Islamic Bank (QIIK QD) 83.60 DOWN UP 83.00 80.70 84.50 86.10 Qatar Insurance (QATI QD)* 80.00 UP UP 79.00 78.00 80.70 81.40 Al Khalij Commercial Bank (KCBK QD) 22.70 DOWN DOWN 22.50 21.98 22.90 23.23 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 84.00 DOWN UP 83.00 81.70 85.00 87.80 Al Meera Consumer Goods Co. (MERS QD) 179.30 DOWN DOWN 179.00 175.00 180.00 183.00 Industrials Industrials Industries Qatar (IQCD QD)* 179.00 DOWN DOWN 178.30 175.50 180.00 181.40 Qatar Electricity & Water Co. (QEWS QD) 187.00 DOWN UP 185.00 182.00 188.00 190.00 Gulf International Services (GISS QD) 92.70 DOWN FLAT 91.40 90.00 93.00 95.00 Qatari Investors Group (QIGD QD) 60.90 DOWN DOWN 59.70 57.80 61.30 62.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD)* 40.75 DOWN UP 40.40 39.70 41.00 43.00 United Development Co. (UDCD QD) 24.90 DOWN FLAT 24.75 24.50 25.30 26.00 Telecom Telecom Ooredoo (ORDS QD) 143.90 DOWN DOWN 142.50 141.80 145.00 147.40 Vodafone Qatar (VFQS QD)* 19.55 DOWN UP 19.29 18.75 20.00 20.79 Transportation Transportat Nakilat (QGTS QD) 23.30 DOWN FLAT 23.00 22.70 23.40 23.90 Milaha (QNNS QD) 90.70 DOWN DOWN 90.00 88.70 91.30 93.00