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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Upmove
The QE Index extended its northward journey for the fourth straight
session and rose around 94 points (0.68%) to close above 13,750.0.
The index managed to move above 13,700.0 and gathered further
momentum as the bulls were under complete control. Meanwhile,
both the momentum indicators are providing bullish signals, indicating
that the index has enough steam to accelerate further. On the flip
side, 13,750.0 may act as an intermediate support.
Al Khalij Commercial Bank: Short-Term – Bounce Back
KCBK gained 0.82% and cleared the resistances of the 55-day
moving average and the ascending pennant, which had restricted its
bullish move in the past. We believe based on the recent price action
and spike in volumes, the stock may surpass the 21-day moving
average, targeting QR22.35. Further, the RSI has rejected the mid-
line and is moving up, indicating strength. However, a retreat below
the 55-day moving average may drag the stock down.
Al Rayan Islamic Index: Short-Term – Uptrend
The QERI Index continued its bullish momentum for the fourth
consecutive day and recorded a new all-time high. The index
showcased yet another enthusiastic performance by rallying over a
percentage point. We believe the index is in an uptrend mode and
may rally further to tag new highs. Meanwhile, both the momentum
indicators are pointing higher and are showing no immediate trend
reversal signs. Conversely, the index may find support near 4,770.0.
Qatar Electricity & Water Co.: Short-Term – Pullback
QEWS developed a Doji candlestick pattern on Wednesday and
declined on Thursday, breaching its support of QR188.0 on the back
of large volumes. Moreover, the stock developed an evening star
candle pattern, which usually indicates a bearish sign. Further, with
the RSI on a negative slope, the stock may continue to drift down and
test QR186.0, followed by the moving averages. Conversely, a move
above QR188.0 may halt its pullback.
Qatar Islamic Bank: Short-Term – Upmove
QIBK jumped around 6% and tagged a new 52-week high after
moving sideways for the past two days. The stock has been moving
up consistently since June and is forming higher tops and higher
bottoms. The current prognosis implies further upside, as QIBK has
support from both the momentum indicators, which are providing
bullish signals. However, traders may need to keep a close watch on
QR123.0 for any reversal signs.
Qatar International Islamic Bank: Short-Term – Bounce Back
QIIK advanced 2.84% and breached the resistances of the 21-day
moving average and the ascending pennant in a single swoop.
Notably, volumes were also large on the rise, indicating rising
optimism among traders. We believe this strong breach of resistances
has bullish implications and the stock may rally further targeting
QR87.50, followed by QR89.0. However, a dip below QR85.90 may
pull the stock. Meanwhile, the RSI is moving in a bullish manner.
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
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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
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*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
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.
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) 13,776.19 UP UP 13,753.36 13,700.00 13,847.11 13,909.87
Al Rayan Islamic Index (QERI Index) 4,788.86 UP UP 4,770.31 4,707.59 4,811.58 4,850.00
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 57.40 UP UP 57.30 55.80 59.90 61.50
Commercial Bank of Qatar (CBQK QD) 67.50 DOWN UP 67.30 66.50 68.30 69.50
Doha Bank (DHBK QD) 60.80 UP UP 60.00 58.00 61.00 62.00
Qatar Islamic Bank (QIBK QD)* 123.80 UP UP 123.00 121.50 126.00 128.00
Qatar International Islamic Bank (QIIK QD)* 86.80 UP UP 85.90 85.00 87.50 89.00
Qatar Insurance (QATI QD) 96.40 UP UP 96.00 95.20 97.00 99.00
Al Khalij Commercial Bank (KCBK QD)* 22.18 FLAT FLAT 22.00 21.80 22.35 22.50
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 138.00 UP UP 135.20 132.00 139.40 141.00
Al Meera Consumer Goods Co. (MERS QD) 190.00 UP UP 190.00 187.80 191.50 194.80
Industries Qatar (IQCD QD) 188.00 UP UP 186.40 184.50 188.50 190.00
Qatar Electricity & Water Co. (QEWS QD)* 187.00 UP UP 186.00 184.00 188.00 190.00
Gulf International Services (GISS QD) 121.50 UP UP 121.00 118.10 122.50 124.10
Qatari Investors Group (QIGD QD) 59.50 UP UP 57.70 56.20 59.70 60.60
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 42.00 UP UP 41.80 41.00 42.50 43.20
United Development Co. (UDCD QD) 29.85 UP UP 29.05 28.55 29.85 30.45
Ooredoo (ORDS QD) 122.90 DOWN DOWN 122.90 121.50 123.70 124.90
Vodafone Qatar (VFQS QD) 21.63 UP UP 21.40 21.00 21.99 22.30
Nakilat (QGTS QD) 24.54 FLAT UP 24.45 24.12 25.00 25.30
Milaha (QNNS QD) 96.50 UP UP 95.10 93.00 96.50 97.40