18 June Daily technical trader


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18 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 extended its losses for the third straight session and shed around 42 points (-0.34%). However, the index witnessed a stunning recovery and reversed after touching its intraday low of 12,366.29, developing a Doji formation indicating indecision. Meanwhile, the index is currently trading close to its immediate support of 12,500.0. We believe if the index manages to stay above this level it may rebound, or else it may result in bearish implications. Industries Qatar: Short-Term – Bounce Back IQCD momentarily dipped below its support of QR178.30 yesterday, but reversed by gaining 0.51% and developed a bullish piercing candlestick pattern. This pattern usually indicates a bullish signal. Moreover, the RSI is showing signs of a recovery, which is a positive sign. Thus, traders could consider buying the stock at the current level and on declines down to QR178.50 for a target of QR180.0, followed by QR181.40 with a strict stop loss of QR178.30. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index continued to move south for the third consecutive day and fell by -0.09%. Meanwhile, the index momentarily penetrated below its key support of the 4,148.0 level, but later recouped majority of its losses as buyers stepped in and quickly offset its weakness. However, the index faces its immediate resistance of the 55-day moving average, which it needs to clear for the bulls to be back in action; until then the bears may continue to dominate. Qatar Electricity & Water Co.: Short-Term – Pullback QEWS drifted lower and further penetrated below its supports of the 55-day moving average and QR185.0 in a single swoop. Notably, volumes were also large on the decline which is a negative sign. Moreover, the RSI is moving down further from the mid-line, while the MACD is growing more bearish with no immediate trend reversal signs. Thus, traders could consider selling at the current level for a target of QR182.0 with a stop loss of QR185.0. Masraf Al Rayan: Short-Term – Rebound MARK found support at the 55-day moving average and bounced back gaining by 1.16%. Moreover, the stock halted its decline and moved higher with increased participation reflecting optimism among traders. The stock is currently trading exactly on top of its resistance of QR52.30. We believe if the stock manages to cling onto QR52.30 on a closing basis it may proceed ahead and test QR55.0. However, any retreat below QR52.30 may drag the stock to test QR51.80. Ooredoo: Short-Term – Downmove ORDS continued its declining mode and breached its important supports of QR141.80, QR139.0 and QR137.50 in a single trading session caving under heavy selling pressure. Moreover, with both the momentum indicators in downtrend mode, ORDS’ preferred direction seems to be on the downside. Thus, we believe the stock may move down further and test QR133.50. However, if the stock manages to climb above QR137.50 it may halt its downmove.
  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) 12,520.36 DOWN DOWN 12,513.65 12,465.50 12,678.84 12,768.18 Al Rayan Islamic Index (QERI Index) 4,191.46 DOWN DOWN 4,148.08 4,100.00 4,231.77 4,247.18 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 52.30 DOWN UP 51.80 49.75 52.30 55.00 Commercial Bank of Qatar (CBQK QD) 64.70 DOWN DOWN 64.15 63.60 64.92 65.75 Doha Bank (DHBK QD) 58.20 DOWN DOWN 57.40 56.50 59.00 60.10 Qatar Islamic Bank (QIBK QD) 93.30 DOWN UP 91.50 90.00 93.90 96.00 Qatar International Islamic Bank (QIIK QD) 80.50 DOWN DOWN 78.90 78.30 80.70 83.00 Qatar Insurance (QATI QD) 77.00 DOWN UP 77.00 76.00 78.00 79.00 Al Khalij Commercial Bank (KCBK QD) 22.05 DOWN DOWN 21.90 21.49 22.50 22.90 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 83.80 DOWN DOWN 83.00 81.70 85.00 87.80 Al Meera Consumer Goods Co. (MERS QD) 168.00 DOWN DOWN 164.00 159.00 171.00 175.00 Industrials Industrials Industries Qatar (IQCD QD)* 179.00 DOWN DOWN 178.30 175.50 180.00 181.40 Qatar Electricity & Water Co. (QEWS QD)* 183.50 DOWN DOWN 182.00 180.00 185.00 188.00 Gulf International Services (GISS QD) 90.80 DOWN FLAT 90.00 86.60 91.40 93.00 Qatari Investors Group (QIGD QD) 60.30 DOWN DOWN 59.70 57.80 61.30 62.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 39.00 DOWN UP 38.40 37.40 39.20 39.70 United Development Co. (UDCD QD) 24.68 DOWN DOWN 24.50 24.00 24.75 25.30 Telecom Telecom Ooredoo (ORDS QD)* 136.00 DOWN DOWN 133.50 132.00 137.50 139.00 Vodafone Qatar (VFQS QD) 19.60 DOWN UP 19.29 18.75 20.00 20.79 Transportation Transportat Nakilat (QGTS QD) 23.02 DOWN DOWN 23.00 22.45 23.40 23.90 Milaha (QNNS QD) 90.50 DOWN DOWN 90.00 88.70 91.30 93.00