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18 March Daily technical trader


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18 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 snapped its four-day losing streak and moved higher around 71 points (0.62%) as the bulls were back in action. The index not only breached the important resistance of 11,338.41 convincingly, but also surpassed the 11,400.0 psychological level in a single swoop. However, the index needs to cling onto this level in order to advance toward the 11,450.0-11,480.0 levels, or else it may witness a pullback. Meanwhile, the RSI is showing strength and is moving up. Qatar Islamic Bank: Short-Term – Upmove QIBK surpassed the resistances of QR72.80 and the descending trendline in a single trading session, which had restricted its bullish run in the past. Notably, volumes were also large on the upmove. Meanwhile, the stock is currently at the threshold of its immediate resistance at QR74.10. A move above this level may push the stock toward QR75.0, whereas any failure may pull it to test the support of the trendline. Meanwhile, the RSI has shown a bullish divergence. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index continued its rally for the third consecutive day and tagged a new all-time high, surpassing its previous best of 3,464.89. Moreover, the index has been in upmove mode over the past few days and is relentlessly tagging new highs. We believe based on the current price action, the index is poised to tag new highs. However, traders may need to keep a close watch on the 3,458.81 level for any reversal signs as a retreat below this level may test 3,432.56. Vodafone Qatar: Short-Term – Upmove VFQS respected the support of QR12.09 and moved higher clearing the resistance of the 21-day moving average. We believe the current higher push has enough steam to test and clear the immediate resistance of QR12.25, targeting the QR12.40 level. However, any dip below the 21-day moving average may drag the stock to retest the QR12.09 level. Meanwhile, the RSI has rejected the mid-line and is moving up toward the overbought territory in a bullish manner. Industries Qatar: Short-Term – Upmove IQCD continued to move higher yesterday after witnessing a rebound from the QR175.0 level. We believe the stock may continue moving higher as long as it clings onto the support of QR175.0. Meanwhile, the stock faces its immediate resistance of QR178.30. A move above this level may confirm this bullish move and spark additional buying interest, which may push the stock to test the QR180.0 level. The stock has support for a higher move from the RSI which is moving up. Doha Bank: Short-Term – Downmove DHBK continued to weaken further yesterday. The stock momentarily moved above the QR57.40 level, but later caved under selling pressure. With both the momentum indicators in downtrend mode, DHBK’s preferred direction seems to be on the downside. We believe the stock may continue its decline toward QR56.20. Any sustained weakness below this level may pull the stock further down. However, a close above QR57.40 may provide some relief.
  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 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) 11,401.65 DOWN UP 11,338.41 11,300.00 11,484.45 11,520.55 Al Rayan Islamic Index (QERI Index) 3,471.96 UP UP 3,458.51 3,432.26 3,482.00 3,500.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 37.90 DOWN UP 36.55 35.10 39.10 40.00 Commercial Bank of Qatar (CBQK QD) 62.90 DOWN UP 61.50 60.00 64.00 65.20 Doha Bank (DHBK QD)* 56.80 DOWN DOWN 56.20 55.20 58.20 60.00 Qatar Islamic Bank (QIBK QD)* 73.90 DOWN DOWN 70.50 69.50 75.00 76.00 Qatar International Islamic Bank (QIIK QD) 71.20 DOWN UP 70.30 69.40 71.50 72.80 Qatar Insurance (QATI QD) 63.50 DOWN UP 60.96 58.20 64.00 66.90 National Leasing Holding Co. (NLCS QD) 28.50 DOWN DOWN 28.00 27.52 29.15 29.95 Consumer Goods and Services Consumer G Widam Food Co. (WDAM QD) 42.65 DOWN DOWN 41.90 39.50 44.50 45.90 Al Meera Consumer Goods Co. (MERS) 163.00 UP UP 159.00 154.90 164.00 165.00 Industrials Industries Qatar (IQCD QD)* 177.30 DOWN DOWN 175.00 173.00 178.30 180.00 Qatar Electricity & Water Co. (QEWS QD) 170.30 FLAT UP 168.00 165.36 170.91 174.36 Gulf International Services (GISS QD) 78.80 UP UP 75.20 73.44 80.00 81.00 Qatari Investors Group (QIGD QD) 52.50 UP DOWN 52.40 49.75 54.00 56.20 Real Estate Barwa Real Estate Co. (BRES QD) 35.95 UP UP 34.80 34.20 36.30 37.00 United Development Co. (UDCD QD) 21.83 DOWN DOWN 21.70 21.50 22.00 22.20 Telecom Ooredoo (ORDS QD) 139.00 DOWN DOWN 138.50 136.00 139.90 141.00 Vodafone Qatar (VFQS QD)* 12.22 UP UP 12.09 11.90 12.25 12.40 Transportat Nakilat (QGTS QD) 21.11 DOWN UP 20.90 20.50 21.83 22.19 Milaha (QNNS QD) 93.10 DOWN UP 91.30 90.00 95.10 96.50