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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Neutral
The QE Index snapped its four-day winning streak and shed around
23 points (-0.16%) as traders opted to book profits. The index
witnessed a gap-up opening and reached an intraday high of
13,850.18, but failed to hold onto its gains and retreated. However,
the upmove in the index remains intact. We believe the index may
continue to move higher until it stays above the 13,700.0 level. On
the flip side, any retreat below 13,700.0 may result in a pullback.
Al Khalij Commercial Bank: Short-Term – Bounce Back
KCBK gained marginally and moved closer to the 21-day moving
average. Notably, volumes were also large on the rise indicating
optimism among traders. The stock has been moving along the
ascending pennant over the past few days. We believe the stock is
gearing for a further upmove and may test and surpass the 21-day
moving average, targeting QR22.35. Conversely, any failure to clear
the 21-day moving average may result in consolidation.
Al Rayan Islamic Index: Short-Term – Neutral
The QERI Index halted its gains and closed the volatile session with a
cut of -0.45%, after tagging a fresh all-time high in the previous
session. The index momentarily moved above the 4,800.0 level, but
failed to make any further headway and reversed on the back of
profit-booking. Meanwhile, the index has intermediate support of
4,750.0. We believe the bulls may continue to dominate as long as
the index clings onto 4,750.0, or else it may drift toward 4,700.0.
Al Meera Consumer Goods Co.: Short-Term – Pullback
MERS failed to make any further headway above QR191.50 and
declined breaching its important supports of the 21-day moving
average and the ascending pennant trendline. Further, the RSI and
the MACD lines are pointing down indicating weakness. We believe
although the stock is trading close to its immediate support of
QR187.80, it may not hold onto it and drift down further to test
QR185.0. However, if the stock stays above QR187.80 it may rally.
Nakilat: Short-Term - Pullback
QGTS dipped below its key supports of QR24.45 and the 21-day
moving average after holding above it since the past few days, which
is a negative sign. We believe this strong breach of supports has
bearish implications and provides a downside target of QR24.12
followed by QR23.90. However, if the stock manages to reclaim the
21-day moving average it may provide some relief. Meanwhile, both
the momentum indicators are indicating weakness.
Qatar International Islamic Bank: Short-Term – Bounce Back
QIIK built on its gains and advanced 2.19% surpassing the QR87.0
and QR87.80 in a single swoop. The stock is currently on the
threshold of its immediate resistance of QR89.0. Any move above this
level may trigger fresh buying, which may push the stock further
toward QR90.50. However, any failure to move above QR89.0 may
result in a sideways movement. Meanwhile, both the indicators are
providing bullish signals, indicating the possibility of a further rise.
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
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.
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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) 13,753.51 UP UP 13,753.36 13,700.00 13,847.11 13,909.87
Al Rayan Islamic Index (QERI Index) 4,767.12 UP UP 4,750.00 4,707.59 4,811.58 4,850.00
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 56.50 UP UP 55.80 54.00 57.30 59.90
Commercial Bank of Qatar (CBQK QD) 67.90 FLAT UP 67.30 66.50 68.30 69.50
Doha Bank (DHBK QD) 60.40 UP UP 60.00 58.00 61.00 62.00
Qatar Islamic Bank (QIBK QD) 122.00 UP UP 121.50 119.50 123.00 126.00
Qatar International Islamic Bank (QIIK QD)* 88.70 UP UP 87.80 87.00 89.00 90.50
Qatar Insurance (QATI QD) 96.50 UP UP 96.00 95.20 97.00 99.00
Al Khalij Commercial Bank (KCBK QD)* 22.19 FLAT UP 22.00 21.80 22.35 22.50
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 137.10 UP UP 135.20 132.00 139.40 141.00
Al Meera Consumer Goods Co. (MERS QD)* 188.00 DOWN UP 187.80 185.00 190.00 191.50
Industries Qatar (IQCD QD) 189.00 UP UP 188.50 186.40 190.00 191.50
Qatar Electricity & Water Co. (QEWS QD) 186.90 UP UP 186.00 184.00 188.00 190.00
Gulf International Services (GISS QD) 121.00 UP UP 121.00 118.10 122.50 124.10
Qatari Investors Group (QIGD QD) 59.10 UP UP 57.70 56.20 59.70 60.60
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 41.80 UP UP 41.80 41.00 42.50 43.20
United Development Co. (UDCD QD) 29.65 UP UP 29.05 28.55 29.85 30.45
Ooredoo (ORDS QD) 123.50 DOWN DOWN 122.90 121.50 123.70 124.90
Vodafone Qatar (VFQS QD) 21.50 UP UP 21.40 21.00 21.99 22.30
Nakilat (QGTS QD)* 24.35 DOWN UP 24.12 23.90 24.45 25.00
Milaha (QNNS QD) 94.90 UP UP 93.00 91.30 95.10 96.50