27 March Daily technical trader


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27 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 gained around 22 points (0.19%) for the second straight session as buying interest pushed the price higher. The index witnessed a gap-down opening, but later managed to recoup its losses to close the volatile session at 11,331.46. However, a move above 11,338.41, which is also in proximity to the 55-day moving average, is needed for a further confirmation of this bullish move. Meanwhile, the index has support near the 11,300.0 level. Barwa Real Estate Co.: Short-Term – Upmove BRES continued its upmove and breached the resistance of QR35.80 yesterday. The stock is rapidly approaching toward its immediate resistance of QR36.80 and has strong momentum going in, as indicated by the recent price swings and volumes. A breach above this level may spark additional buying interest, which may push the stock to test QR37.40. However, a dip below QR35.80 may halt its upmove. Meanwhile, both the indicators are providing bullish signals. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index extended its gains and tagged a new all-time high of 3,499.36, but later trimmed its gains to close at 3,494.13. The index not only surpassed its immediate resistance of 3,481.42, but also successfully cleared the 3,490.49 level as the bulls were under full control. We believe this strong breach of resistances has bullish implications and the index may continue its advance. Traders may need to keep a close watch on 3,490.49 for any reversal signs. Qatar Insurance: Short-Term – Pullback QATI has been hovering under its 21-day moving average and seems to be facing difficulty in clearing it. We believe as long as the stock trades below this moving average the upmove seems to be in jeopardy. With both the indicators pointing down, QATI may continue to drift lower and test its immediate support of QR62.64, which is also in proximity to the 55-day moving average. A close above the 21-day moving average would be an accumulation signal. Qatar Islamic Bank: Short-Term – Upmove QIBK cleared the resistances of QR72.80 and the descending trendline, which had restricted its bullish run in the past on the back of large volumes. The stock is once again approaching the QR74.10, level which is also in proximity to the 21-day moving average. If the stock can breach this level, it will confirm this upmove targeting QR75.0. However, a dip below QR72.80 may result in a pullback. The RSI is supporting this bullish sentiment by moving upward. Industries Qatar: Short-Term – Pullback IQCD witnessed a gap-up opening and momentarily moved above the resistance of QR178.30, but later trimmed its gains as there was exhaustion on the part of buyers. We believe the stock must overcome this level in order to advance further. Meanwhile, the MACD is drifting further down from the signal line, while the RSI is stalling from the rising mode indicating a price correction. Hence, we expect a pullback from the current level targeting the QR175.0 level.
  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) 11,331.46 DOWN DOWN 11,300.00 11,250.00 11,338.41 11,400.00 Al Rayan Islamic Index (QERI Index) 3,494.13 UP UP 3,490.49 3,481.42 3,499.36 3,530.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 38.55 FLAT UP 38.00 36.55 39.10 40.00 Commercial Bank of Qatar (CBQK QD) 60.50 DOWN DOWN 59.33 58.40 61.67 62.75 Doha Bank (DHBK QD) 58.80 DOWN DOWN 57.40 56.20 60.00 62.00 Qatar Islamic Bank (QIBK QD)* 73.00 DOWN DOWN 71.80 70.50 74.10 75.00 Qatar International Islamic Bank (QIIK QD) 71.30 DOWN UP 70.30 69.40 72.80 74.40 Qatar Insurance (QATI QD)* 63.10 DOWN FLAT 62.64 61.52 65.68 66.90 National Leasing Holding Co. (NLCS QD) 28.15 DOWN DOWN 28.00 27.52 29.15 29.95 Consumer Goods and Services Consumer G Widam Food Co. (WDAM QD) 44.70 DOWN UP 44.50 43.20 47.80 48.75 Al Meera Consumer Goods Co. (MERS) 158.00 FLAT UP 154.90 151.50 159.00 164.00 Industrials Industries Qatar (IQCD QD)* 177.70 DOWN DOWN 175.00 173.00 180.00 181.40 Qatar Electricity & Water Co. (QEWS QD) 169.30 DOWN UP 168.00 165.36 170.91 174.36 Gulf International Services (GISS QD) 76.00 UP UP 75.20 73.20 78.80 80.00 Qatari Investors Group (QIGD QD) 54.80 UP DOWN 54.00 52.40 56.20 58.00 Real Estate Barwa Real Estate Co. (BRES QD)* 36.30 UP UP 35.80 34.80 36.80 37.40 United Development Co. (UDCD QD) 20.38 DOWN DOWN 20.00 19.75 20.50 21.00 Telecom Ooredoo (ORDS QD) 138.90 DOWN DOWN 138.50 136.00 141.00 143.50 Vodafone Qatar (VFQS QD) 11.96 DOWN UP 11.74 11.44 12.09 12.25 Transportat Nakilat (QGTS QD) 19.90 DOWN DOWN 19.80 19.50 20.00 20.44 Milaha (QNNS QD) 93.80 DOWN UP 93.00 91.30 95.10 96.50