16 March Daily technical trader


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16 March 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 continued its decline for the third straight session and fell marginally around 6 points (-0.05%). The index momentarily dipped below 11,338.41, but later managed to close at 11,343.38. However, traders may need to keep a close watch on the support at the 11,338.41 level, as a close below this level may trigger a sell-off. On the other hand, the index may advance toward 11,400.0 if it manages to cling onto the 11,338.41 level. United Development Co.: Short-Term – Upmove UDCD rebounded and breached the resistance of QR22.0 on the back of increased volumes, which is a positive sign. We believe if UDCD can stay above QR22.0 on a closing basis, then it may set the stage to test and surpass the 21-day moving average, targeting the QR22.20 level. However, a dip below QR22.0 may pull the stock to test QR21.70. Meanwhile, the RSI is moving up toward the mid-line, while the MACD has crossed the signal line into positive territory. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index continued its upmove and rose by 0.61%, after consolidating for a single day on Wednesday. The index witnessed a gap-up opening, but later faced selling pressure as bears pushed the index closer to 3,400.0. However, the index registered a striking rally as it rebounded from its intraday low of 3,403.63 and closed above its resistance of 3,432.36. Meanwhile, the index needs to hold onto this level in order to advance further, or else it may retest 3,409.71. Vodafone Qatar: Short-Term – Breakout VFQS continued to move higher on Thursday and breached the resistances of QR12.09 and the 21-day moving average in a single swoop. Moreover, the stock has been gaining strength over the past few days and is moving up. With both indicators providing bullish signals, we believe the stock may be ready for a move above QR12.25, targeting the QR12.40 level. However, a close below the 21-day moving average may result in a pullback. Qatar Electricity & Water Co.: Short-Term – Downmove QEWS witnessed a gap-up opening but later faced selling pressure and penetrated below the support of QR168.0. The stock has been encountering stiff resistance from the 21-day moving average and the descending trendline over the past few days. Meanwhile, the stock developed a bearish Marubozu candle pattern, indicating continuation of this downmove. Further, with both indicators pointing down, QEWS is likely to test QR167.19 followed by the QR165.36 level. Ooredoo: Short-Term – Downmove ORDS dipped below the support of QR139.90 on Wednesday and continued its decline on Thursday, moving below the support of QR138.50 on the back of large volumes. Moreover, with both momentum indicators in a downtrend mode, the preferred direction for ORDS seems to be on the downside. We believe although the stock is trading close to its immediate support of QR136.0, it is unlikely that it may hold onto it and may drift down further to test QR133.90.
  2. 2. Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Trading Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6535 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa ahmed.shehada@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@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) 11,343.38 DOWN UP 11,338.41 11,171.33 11,400.00 11,484.45 Al Rayan Islamic Index (QERI Index) 3,440.66 UP UP 3,432.26 3,409.71 3,458.51 3,470.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 38.20 DOWN UP 38.00 36.55 39.10 40.00 Commercial Bank of Qatar (CBQK QD) 75.50 FLAT UP 75.30 74.00 76.40 77.00 Doha Bank (DHBK QD) 57.30 DOWN DOWN 56.20 55.20 58.20 60.00 Qatar Islamic Bank (QIBK QD) 73.50 DOWN DOWN 72.80 70.50 75.00 76.00 Qatar International Islamic Bank (QIIK QD) 71.50 DOWN UP 71.50 70.30 72.80 74.40 Qatar Insurance (QATI QD) 62.50 DOWN UP 60.96 58.20 64.00 66.90 National Leasing Holding Co. (NLCS QD) 28.15 DOWN DOWN 28.00 27.52 29.15 29.95 Consumer Goods and Services Consumer G Widam Food Co. (WDAM QD) 42.15 DOWN DOWN 41.90 39.50 44.50 45.90 Al Meera Consumer Goods Co. (MERS) 161.90 UP UP 159.00 154.90 164.00 165.00 Industrials Industries Qatar (IQCD QD) 175.20 DOWN DOWN 175.00 173.00 180.00 182.50 Qatar Electricity & Water Co. (QEWS QD)* 167.50 DOWN UP 165.36 163.30 168.00 170.91 Gulf International Services (GISS QD) 74.80 UP UP 73.44 70.44 75.20 76.50 Qatari Investors Group (QIGD QD) 52.00 UP DOWN 49.75 47.70 52.40 56.20 Real Estate Barwa Real Estate Co. (BRES QD) 35.80 UP UP 34.80 34.20 36.30 37.00 United Development Co. (UDCD QD)* 22.07 DOWN DOWN 22.00 21.70 22.20 22.50 Telecom Ooredoo (ORDS QD)* 136.50 DOWN DOWN 136.00 133.90 138.50 139.90 Vodafone Qatar (VFQS QD)* 12.20 DOWN UP 12.09 11.90 12.25 12.40 Transportat Nakilat (QGTS QD) 21.40 DOWN UP 20.90 20.50 21.83 22.19 Milaha (QNNS QD) 92.80 DOWN UP 91.30 90.00 93.00 95.10