25 May Daily technical trader


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25 May Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Bounce Back The QE Index snapped its six day losing streak and rallied aggressively, gaining around 329 points (2.59%) on the back of large volumes. The index witnessed an impressive run as it rebounded by breaching its resistances near 12,770.0 and 12,940.0, as well as the 21-day moving average to close at its day’s high of 13,008.16. We believe, based on the recent price swing, the index may further continue its rally toward the 13,080.0-13,100.0 levels. Industries Qatar: Short-Term – Rebound IQCD halted its decline on Wednesday and bounced back on Thursday, surpassing its resistances of QR180.0 and QR181.40, which is a positive sign. We believe the current higher push has enough steam to surpass its immediate resistance of QR183.0, which is also in proximity to the 55-day moving average targeting the 21-day moving average. However, any failure to clear QR183.0 may result in consolidation. Meanwhile, the RSI has shown a bullish divergence. Al Rayan Islamic Index: Short-Term – Bounce Back The QERI Index halted its four days of losses and rebounded, surging around 2.07% to settle above the 4,300.0 level. The index made a gap-up opening and subsequently witnessed strong gains as it cleared the resistances of 4,247.34, the 21-day moving average and 4,301.89 in a single trading session, thus keeping its uptrend intact. We believe the index has strong momentum going and may proceed toward the 4,340.0 level. Ooredoo: Short-Term – Rebound ORDS witnessed a gap-up opening and bounced back, breaching its resistances of both the 21-day and 55-day moving averages and QR147.80 after consolidating below it over the past few days. Moreover, the stock developed a bullish Marubozu candle pattern, indicating a likely continuation of this rebound. The recent spike in volumes and bullish RSI divergence are hinting that the stock may continue to move ahead and test QR149.0, followed by QR151.0. Masraf Al Rayan: Short-Term – Uptrend MARK cleared its resistances of QR51.0 and QR51.80 in a single swoop and tagged a new all-time high on the back of large volumes. Moreover, with the RSI moving strongly into the overbought territory and the MACD about to cross the signal line in a bullish manner, MARK’s preferred direction seems to be on the upside. We believe the stock may continue its rally and record new highs. However, traders may have to keep a close watch at QR51.80 for any reversal. United Development Co.: Short-Term – Upmove UDCD eventually penetrated above the important resistance of QR26.0 after struggling to move above it over the past few days. We believe if the stock manages to cling onto QR26.0 on a closing basis, it may rally further toward QR26.45. However, a dip below QR26.0 may result in a pullback, forcing the stock to test its 21-day moving average. Meanwhile, the RSI has enough room before becoming overbought, while the MACD is showing signs of recovery.
  2. 2. Contacts Saugata Sarkar Keith Whitney Sahbi Kasraoui QNB Financial Services SPC Head of Research Head of Sales Manager - HNWI Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6534 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 PO Box 24025 saugata.sarkar@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@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) 13,008.16 UP UP 12,939.80 12,900.00 13,079.52 13,195.88 Al Rayan Islamic Index (QERI Index) 4,316.48 UP UP 4,301.89 4,247.34 4,341.10 4,370.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 52.10 UP UP 51.80 51.00 53.00 54.50 Commercial Bank of Qatar (CBQK QD) 67.50 DOWN UP 66.30 65.75 67.80 68.40 Doha Bank (DHBK QD) 64.00 DOWN UP 63.30 62.00 64.60 65.70 Qatar Islamic Bank (QIBK QD) 95.00 UP UP 93.90 92.00 96.00 97.25 Qatar International Islamic Bank (QIIK QD) 86.60 UP UP 86.10 83.00 87.80 89.00 Qatar Insurance (QATI QD) 76.00 FLAT UP 74.80 72.50 76.00 77.00 Al Khalij Commercial Bank (KCBK QD) 23.39 UP UP 23.23 22.90 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 87.70 FLAT UP 87.00 86.25 87.80 90.50 Al Meera Consumer Goods Co. (MERS QD) 184.70 FLAT UP 183.00 182.00 185.00 187.00 Industrials Industrials Industries Qatar (IQCD QD)* 183.00 DOWN FLAT 181.40 180.00 183.00 186.40 Qatar Electricity & Water Co. (QEWS QD) 183.40 DOWN UP 182.00 180.00 185.00 188.00 Gulf International Services (GISS QD) 96.00 UP UP 95.00 93.00 97.00 100.00 Qatari Investors Group (QIGD QD) 65.80 DOWN UP 64.80 62.40 66.50 68.40 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 39.20 UP UP 38.40 37.40 39.20 40.35 United Development Co. (UDCD QD)* 26.15 UP UP 26.00 25.29 26.45 27.10 Telecom Telecom Ooredoo (ORDS QD)* 148.50 UP UP 147.80 145.00 149.00 151.00 Vodafone Qatar (VFQS QD) 18.35 UP UP 17.99 17.30 18.49 18.75 Transportation Transportat Nakilat (QGTS QD) 23.51 DOWN UP 23.40 22.45 23.90 24.20 Milaha (QNNS QD) 94.20 DOWN DOWN 92.90 91.30 95.10 96.50