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22 January Daily technical trader


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22 January Daily technical trader

  1. 1. TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Neutral Al Rayan Islamic Index: Short-Term – Neutral Al Meera Consumer Goods Co.: Short-Term – Breakout The QE Index gained around 75 points (0.68%) and reclaimed the 11,100.0 psychological level after witnessing a decline over the past two days. The index respected its support near 11,060.0 and rebounded as buyers stepped in and quickly offset the weakness. We believe if the index manages to hold onto 11,100.0, it may continue to advance toward the 11,170.0-11,200.0 levels. However, a dip below 11,100.0 may result in a pullback and the index may test 11,060.0. The QERI Index witnessed a gap-up opening and cleared the resistance of 3,199.21, keeping its upward momentum intact. However, buying is not recommended until a further bullish confirmation occurs. Meanwhile, the index needs to sustain above the 3,199.21 level in order to proceed toward 3,240.37. However, if the index dips below 3,199.21 on a closing basis, bears may take charge and drag it toward 3,185.46. MERS surpassed the long-term resistance of QR142.70 after consolidating below this level over the past few days indicating a positive sign for the buyers. We believe if the stock manages to cling onto the QR142.70 level; it may set the stage for a test of QR145.90. However, a dip below QR142.70 may result in a false breakout. Meanwhile, the RSI is moving higher toward the overbought territory indicating a likely higher move. Ooredoo: Short-Term – Breakout Qatari Investors Group: Short-Term – Bounce Back Gulf International Services: Short-Term – Upmove ORDS breached the resistances of QR145.0 and QR145.90 in a single swoop for the first time since August on the back of large volumes. We believe this strong breach of resistances has bullish implications and provides an upside target of QR148.0. Moreover, the RSI is moving strongly in the overbought territory, while the MACD is diverging away from the signal line in a bullish manner indicating the possibility of a potential rally. QIGD tested the support of QR44.20 and rebounded yesterday. Moreover, the stock developed a hammer candle pattern which usually indicates a trend reversal, which was bearish until now. We believe traders may witness a price rebound from the current level with an upside target near QR46.0. Thus, short-term traders may accumulate at the current levels. However, if QIGD closes below QR44.20, it may continue its downmove targeting QR43.45. GISS respected the support of QR68.80 for the second consecutive day and moved higher. We believe this rebound from the support is indicating a rise toward QR71.20. If the stock manages to move above this level, it may spark additional buying interest, which may push the stock toward QR72.0. Meanwhile, the RSI is moving higher in the overbought territory indicating a likely upmove. However, if the stock dips below QR70.0, it may retest QR68.80. Page 1 of 2
  2. 2. Name (Ticker) Last Close Trend Short Term Support Long Term First Resistance Second First Second Qatar Exchange Index (QE Index) 11,147.39 UP UP 11,060.00 11,000.00 11,170.00 11,250.00 Al Rayan Islamic Index (QERI Index) 3,214.15 UP UP 3,199.21 3,185.46 3,240.37 3,300.00 Masraf Al Rayan (MARK QD) 35.05 UP UP 35.00 34.15 36.00 37.25 Commercial Bank of Qatar (CBQK QD) 74.80 UP UP 74.50 73.30 75.30 76.00 Doha Bank (DHBK QD) 64.90 UP UP 64.50 63.90 66.00 66.75 Qatar Islamic Bank (QIBK QD) 74.50 UP UP 74.00 73.00 75.00 75.70 Qatar International Islamic Bank (QIIK QD) 69.10 UP UP 68.00 66.20 69.40 71.20 Qatar Insurance (QATI QD) 75.30 UP UP 75.00 74.30 76.00 76.90 National Leasing Holding Co. (NLCS QD) 30.25 DOWN DOWN 29.95 29.15 30.25 30.60 Widam Food Co. (WDAM QD) 52.00 DOWN UP 51.90 51.00 53.00 54.00 Al Meera Consumer Goods Co. (MERS)* 143.00 UP UP 142.70 140.50 145.90 148.00 Industries Qatar (IQCD QD) 179.00 UP UP 178.30 177.00 180.00 181.20 Qatar Electricity & Water Co. (QEWS QD) 181.20 UP UP 180.00 178.90 182.50 184.00 Gulf International Services (GISS QD)* 70.80 UP UP 70.00 68.80 71.20 72.00 Qatari Investors Group (QIGD QD)* 45.20 DOWN UP 44.20 43.45 46.00 47.70 Barwa Real Estate Co. (BRES QD) 32.50 UP UP 32.10 31.60 32.60 33.20 United Development Co. (UDCD QD) 23.25 UP UP 23.15 22.85 23.50 23.94 Ooredoo (ORDS QD)* 146.70 UP UP 145.90 145.00 148.00 150.00 Vodafone Qatar (VFQS QD) 11.47 UP UP 11.44 11.19 11.60 12.09 Nakilat (QGTS QD) 21.05 UP UP 20.74 20.50 21.32 21.44 Milaha (QNNS QD) 90.70 UP UP 90.00 89.40 91.30 93.00 Banks and Financial Services Banks and Consumer Goods and Services Consumer G Industrials Industrials Real Estate Real Estate Telecom Telecom Transportation Transportat *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 55day 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. Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Tel: (+974) 4476 6534 Head of Trading Tel: (+974) 4476 6535 Head of Sales Tel: (+974) 4476 6533 Manager - HNWI Tel: (+974) 4476 6544 Contact Center: (+974) 4476 6666 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