17 July Daily technical trader


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17 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 extended its gains for the third straight session and rose around 73 points (0.56%). The index witnessed a strong opening and momentarily pushed it near the 13,300.0 level; however, it later trimmed its gains to close at 13,173.34. We believe if the index manages to sustain above its resistance near 13,196.0, it could set the stage for a further higher move. However, any failure to move above 13,196.0 may result in a range-bound movement. Doha Bank: Short-Term – Upmove DHBK jumped 4.24% and surpassed the resistances of QR60.0 and the 55-day moving average in a single swoop. Notably, volumes were also high on the rise indicating rising optimism among traders. We believe this strong breach of resistances has bullish implications and provides an upside target of QR62.0, followed by QR63.30. However, a dip below the 55-day moving average may result in a pullback. Meanwhile, both the indicators are pointing higher. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index continued its northward journey for the third consecutive day and gained 0.61% to close near the 4,400.0 level. The index has been in upmove mode and is registering strong gains over the past few days. We believe the bulls may continue to dominate the bears and the index may head toward 4,445.0. Meanwhile, both the indicators are looking strong supporting this bullish sentiment. Conversely, 4,350.0 may act as a strong support. Vodafone Qatar: Short-Term – Upmove VFQS gained 3.45% and cleared the important resistance of QR20.0 after feigning a failure in the past few attempts. We believe based on the recent price swing and spike in volumes the stock may continue its rally and test the QR20.78 level. Moreover, the RSI is in the buy zone, while the MACD is diverging away from the signal line in a bullish manner indicating a likely higher move. However, a decline below QR20.0 on a closing basis may halt VFQS’ upmove. Industries Qatar: Short-Term – Pullback IQCD failed to make any further headway above QR180.0 and retreated yesterday. Moreover, the stock dipped below the support of QR178.30 on the back of large volumes, which is a negative sign. Further, the RSI is showing signs of weakness indicating a likely correction. Thus, traders could consider selling the stock at the current level for a target of QR175.50, which is also in proximity to the 21-day moving average. Nakilat: Short-Term – Upmove QGTS witnessed a gap-up opening and cleared the resistances of the 55-day moving average and QR23.60 in a single trading session. Moreover, the stock has been in upmove mode and is showing strength over the past few days. We believe the stock may continue its positive momentum and proceed toward QR24.12. Further, both the momentum indicators are growing in a bullish manner indicating a likely advance. However, a dip below QR23.60 may be bearish.
  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) 13,173.34 UP UP 13,079.52 12,939.80 13,195.88 13,320.89 Al Rayan Islamic Index (QERI Index) 4,399.71 UP UP 4,350.00 4,311.42 4,444.86 4,528.58 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 55.10 UP UP 54.00 52.60 55.20 57.30 Commercial Bank of Qatar (CBQK QD) 69.00 UP UP 68.30 67.30 69.50 70.00 Doha Bank (DHBK QD)* 61.40 UP UP 60.00 59.00 62.00 63.30 Qatar Islamic Bank (QIBK QD) 107.20 UP UP 106.00 104.50 109.50 111.00 Qatar International Islamic Bank (QIIK QD) 86.90 UP UP 86.10 85.00 88.00 88.50 Qatar Insurance (QATI QD) 91.50 UP UP 90.90 88.90 91.50 92.40 Al Khalij Commercial Bank (KCBK QD) 22.35 UP FLAT 22.00 21.87 22.35 22.60 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 92.10 UP UP 90.50 89.80 92.10 92.50 Al Meera Consumer Goods Co. (MERS QD) 183.70 UP UP 181.60 177.50 185.00 186.00 Industrials Industrials Industries Qatar (IQCD QD)* 178.00 UP DOWN 175.50 171.00 180.00 181.40 Qatar Electricity & Water Co. (QEWS QD) 189.00 UP UP 188.00 186.28 191.50 193.00 Gulf International Services (GISS QD) 108.50 UP UP 104.50 103.50 111.90 113.00 Qatari Investors Group (QIGD QD) 55.40 DOWN DOWN 54.40 54.00 56.10 57.00 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 43.10 UP UP 42.50 41.80 43.20 43.80 United Development Co. (UDCD QD) 25.55 UP FLAT 25.30 24.75 26.00 26.45 Telecom Telecom Ooredoo (ORDS QD) 136.40 UP DOWN 136.00 133.90 138.00 140.50 Vodafone Qatar (VFQS QD)* 20.10 UP UP 20.00 19.30 20.78 21.99 Transportation Transportat Nakilat (QGTS QD)* 23.95 UP UP 23.60 23.00 24.12 24.45 Milaha (QNNS QD) 97.90 UP UP 96.50 95.10 98.50 100.00