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5 August Daily technical trader


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5 August 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 four-day losing streak and gained around 126 points (0.98%) to settle near the 13,000.0 psychological level. The index respected the support of the 55-day moving average and rebounded, as sustained buying pushed it higher. The index managing to close above its key resistance of 12,940.0 after two failed attempts is a positive development. The index needs to cling onto that level to advance further, or else it may retreat. Al Meera Consumer Goods Co.: Short-Term – Upmove MERS gained 2.15% and cleared the key resistance of QR187.80 for the first time since April, which is a positive sign. The recent price action and the rise in volumes indicate that MERS could continue to move up toward QR194.80. Moreover, the RSI is moving strongly into the overbought territory, while the MACD is diverging away from the signal line on the upside. However, traders may need to keep a close watch on QR187.80 for any reversal signs. Al Rayan Islamic Index: Short-Term – Bounce Back The QERI Index extended its rebound and ended the session in green for the second day in a row. The index gained 1.72% and cleared both the 4,350.0 and 4,400.0 levels in a single swoop, as the bulls were back in action. The index has been showing signs of strength over the past two days and is moving up. We believe the index has a strong momentum going and has enough steam to test 4,445.0. Conversely, 4,375.0 may act as a near-term support. Qatar Islamic Bank: Short-Term – Upmove QIBK breached the resistance of the ascending triangle at QR107.0 after witnessing a brief correction. The stock has been moving along the ascending trendline over the past few days and is gradually gaining strength. We believe the stock may advance further and test its next resistance at QR109.50. Meanwhile, the RSI in the buy zone is supporting this bullish sentiment. However, a decline below QR107.0 may drag the stock down. Nakilat: Short-Term - Upmove QGTS jumped 3.64% and surpassed the resistances of QR24.12 and QR24.45 after consolidating below them over the past few weeks. Notably, volumes were also large on the rise, suggesting potential buyers are stepping in. Further, both the momentum indicators are rising in a bullish manner, indicating a likely higher move. Thus, traders may consider buying the stock at the current level for a target of QR25.30 with a strict stop loss of QR24.45. Medicare Group: Short-Term – Uptrend MCGS surged 9.95% and tagged fresh new all-time high on the back of large volumes, indicating increased optimism among traders. Moreover, the stock developed a long bullish Marubozu candle pattern, suggesting a likely continuation of this uptrend. Further, both the momentum indicators are pointing higher and are showing no immediate trend reversal signs. We believe the stock may continue its strong rally and accelerate further to record new highs.
  2. 2. Contacts 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 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) 12,991.23 UP UP 12,939.80 12,850.00 13,079.52 13,195.88 Al Rayan Islamic Index (QERI Index) 4,408.94 UP UP 4,375.30 4,341.10 4,444.86 4,528.58 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 53.30 FLAT DOWN 52.50 51.80 54.00 55.80 Commercial Bank of Qatar (CBQK QD) 67.40 FLAT FLAT 67.30 66.50 68.30 69.50 Doha Bank (DHBK QD) 56.90 DOWN DOWN 56.50 55.50 57.40 58.90 Qatar Islamic Bank (QIBK QD)* 108.00 UP UP 107.00 104.50 109.50 111.90 Qatar International Islamic Bank (QIIK QD) 84.90 UP DOWN 83.00 81.50 85.00 86.10 Qatar Insurance (QATI QD) 91.30 UP UP 91.00 88.90 92.40 94.00 Al Khalij Commercial Bank (KCBK QD) 22.55 UP UP 22.35 21.99 22.60 23.23 Consumer Goods and Services Consumer G Medicare Group (MCGS QD)* 118.20 UP UP 115.00 112.00 121.50 124.00 Al Meera Consumer Goods Co. (MERS QD)* 190.00 UP UP 187.80 185.00 194.80 196.00 Industrials Industrials Industries Qatar (IQCD QD) 172.00 DOWN DOWN 170.10 168.00 172.30 173.90 Qatar Electricity & Water Co. (QEWS QD) 182.00 DOWN DOWN 182.00 180.00 184.00 186.00 Gulf International Services (GISS QD) 115.30 UP UP 115.00 111.90 117.90 119.50 Qatari Investors Group (QIGD QD) 52.10 DOWN DOWN 51.00 49.75 52.40 54.20 Real Estate Real Estate Barwa Real Estate Co. (BRES QD) 39.20 DOWN DOWN 38.40 37.50 39.20 39.70 United Development Co. (UDCD QD) 28.90 UP UP 28.55 27.20 29.30 29.90 Telecom Telecom Ooredoo (ORDS QD) 125.20 DOWN DOWN 123.70 117.70 126.00 129.70 Vodafone Qatar (VFQS QD) 19.30 UP UP 19.29 18.75 20.00 20.78 Transportation Transportat Nakilat (QGTS QD)* 24.80 UP UP 24.45 24.12 25.30 25.90 Milaha (QNNS QD) 90.20 DOWN DOWN 90.20 88.80 91.30 92.90