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31 March Daily technical trader


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31 March Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Upmove The QE Index extended its gains for the fourth straight session and rose around 81 points (0.70%) to close at 11,562.87. The index remained bullish during the day and breached the important resistance of 11,520.55, as the bulls continued their domination over the bears. We believe as long as the index stays above 11,520.55, it will continue its bullish momentum and advance toward 11,600.0- 11,660.0 levels. Both the indicators suggest further upside. Widam Food Co.: Short-Term – Breakout WDAM surged 6.96% and surpassed its resistances of QR46.50, 55- day moving average and the descending triangle at QR48.75 in a single swoop. This strong resistance breach has bullish implications and provides an upside target of QR50.50. Moreover, with volumes also picking up on the rise, we believe that the stock may continue to move ahead. However, a decline below QR48.75 may halt its upmove. Meanwhile, both the indicators are looking strong. Al Rayan Islamic Index: Short-Term – Upmove The QERI Index continued its relentless rally and tagged another new all-time high to close above the 3,550.0 level. The current higher push and pick up in volumes suggest that the index may continue its uptrend tagging new highs. Meanwhile, the bullishness in the RSI is intact, while the MACD is diverging away from the signal line and is growing more bullish, showing no immediate trend reversal signs. Hence, it looks like this rally may continue for a longer duration. Doha Bank: Short-Term – Upmove DHBK continued its upmove and breached the immediate resistance of QR62.0 yesterday. We believe if the stock manages to cling onto QR62.0 on a closing basis; it may set the stage for a further higher move and test the 55-day moving average, followed by QR63.30. However, a pullback below QR62.0 warrants some caution. Meanwhile, the RSI is growing bullish and has enough room before slipping into the overbought territory, while the MACD is moving up. Masraf Al Rayan: Short-Term – Upmove MARK after trading predominantly flat over the past few sessions moved higher and cleared the ascending triangle resistance at QR39.10. Moreover, the stock developed a bullish Marubozu candle pattern, indicating a likely continuation of this upmove. The recent price action and spike in volumes indicate MARK may advance further and test QR40.0. However, a dip below QR39.10 may result in a pullback. Meanwhile, the RSI is moving up in a bullish manner. Vodafone Qatar: Short-Term – Upmove VFQS cleared the resistances of the ascending triangle at QR12.09, which is also close to its 21-day moving average, after consolidating below it over the past few days. Notably, volumes were also large on the upmove, which is a positive development. We believe the current higher push has enough steam to test and surpass its immediate resistance at QR12.25 targeting QR12.40. Meanwhile, the RSI has shown a bullish divergence, thus signifying strength.
  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 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) 11,562.87 UP UP 11,520.55 11,484.45 11,660.45 11,733.50 Al Rayan Islamic Index (QERI Index) 3,556.52 UP UP 3,533.01 3,490.49 3,580.00 3,600.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 39.40 UP UP 39.10 38.00 40.00 40.60 Commercial Bank of Qatar (CBQK QD) 63.40 UP UP 61.67 60.92 63.67 64.58 Doha Bank (DHBK QD)* 62.10 UP DOWN 60.00 58.50 63.30 64.00 Qatar Islamic Bank (QIBK QD) 73.90 DOWN DOWN 72.80 71.50 75.00 76.00 Qatar International Islamic Bank (QIIK QD) 71.20 DOWN DOWN 70.30 69.40 72.80 74.40 Qatar Insurance (QATI QD) 64.70 UP UP 62.64 61.52 65.68 66.90 National Leasing Holding Co. (NLCS QD) 29.20 UP FLAT 28.00 27.52 29.95 30.25 Consumer Goods and Services Consumer G Widam Food Co. (WDAM QD)* 49.15 UP UP 48.75 47.80 50.50 51.90 Al Meera Consumer Goods Co. (MERS) 152.00 FLAT UP 150.00 148.90 154.90 159.00 Industrials Industries Qatar (IQCD QD) 183.30 FLAT UP 181.40 180.00 184.50 190.00 Qatar Electricity & Water Co. (QEWS QD) 171.50 UP UP 170.91 168.00 174.36 176.64 Gulf International Services (GISS QD) 78.10 UP UP 75.20 73.20 78.80 80.00 Qatari Investors Group (QIGD QD) 55.00 UP DOWN 54.00 52.40 56.20 58.00 Real Estate Barwa Real Estate Co. (BRES QD) 36.20 UP UP 35.80 34.80 36.80 37.40 United Development Co. (UDCD QD) 20.54 FLAT DOWN 20.00 19.75 21.00 21.30 Telecom Ooredoo (ORDS QD) 139.00 DOWN DOWN 138.50 136.00 141.00 143.50 Vodafone Qatar (VFQS QD)* 12.20 UP UP 12.09 11.90 12.25 12.40 Transportat Nakilat (QGTS QD) 20.20 DOWN DOWN 19.80 19.50 20.26 20.44 Milaha (QNNS QD) 89.90 DOWN UP 89.40 88.60 91.30 93.00