6 May Daily technical trader


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6 May Daily technical trader

  1. 1. Page 1 of 2 TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER QE Index: Short-Term – Uptrend The QE Index extended its phenomenal rally for the fourth straight session gaining around 134 points (1.04%), but later trimmed its gains after hitting the 13,019.55 level to close at a new all-time high of 12,987.95. The index managed to clear its key resistance zone of 12,940.0-12,960.0 after failing over the past three attempts as sustained buying interest pushed it higher. We believe the index may continue to record new highs as it has strong momentum going in. Qatari Investors Group: Short-Term – Breakout QIGD surged 6.44% and surpassed its important resistance of QR68.40 after consolidating below it over the past few days. We believe based on the recent price action and spike in volumes the stock may extend its gains and move toward QR71.70. However, a dip below QR68.40 may drag the stock back into the congestion zone. Meanwhile, the RSI has shown a bullish divergence, while the MACD is closing the signal line in a bullish manner. Al Rayan Islamic Index: Short-Term – Uptrend The QERI Index continued its bullish momentum and rose 1.41% to settle above the 4,300.0 level. The index breached its important resistance near 4,248.0 and subsequently witnessed a strong rally as the bulls continued their domination over the bears for the fourth consecutive session. We believe the index has been rallying aggressively over the past two days and may continue to trend higher. Meanwhile, the RSI is looking strong for a further rally. Qatar Islamic Bank: Short-Term – Upswing QIBK cleared the resistance of QR89.0 after feigning a failure in the past few attempts, which is a positive sign. Moreover, the stock developed a bullish Marubozu candle pattern indicating the continuation of this upmove. We believe with volumes also picking up it seems that the stock may rally further to test QR90.70, followed by QR91.80. Meanwhile, the RSI is moving strongly in the overbought territory, while the MACD is diverging away on the upside. Vodafone Qatar: Short-Term – Uptrend VFQS gained 3.52% tagging a new all-time high of QR19.30, but later trimmed its gains. Notably, volumes were also large on the higher move indicating rising buying interest. We believe the stock may continue to record new highs as long as it trades above the QR18.75 level. However, traders may need to keep a close watch on QR18.75 for any reversal signs as a dip below this level may halt its upmove. Meanwhile, both the indicators suggest a further upmove. Industries Qatar: Short-Term – Upmove IQCD continued its rally and breached its key resistance of QR186.40 on the back of large volumes. The stock is in the process of filling the gap, which it created in the month of March. We believe the current higher push has enough steam to test and surpass QR188.50, which may trigger a fresh higher wave in the stock. However, any failure to clear QR188.50 may result in a pullback. Meanwhile, both the indicators are providing bullish signals.
  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) 12,987.95 UP UP 12,939.80 12,900.00 13,020.00 13,100.00 Al Rayan Islamic Index (QERI Index) 4,301.66 UP UP 4,247.34 4,200.00 4,318.00 4,350.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD) 48.15 UP UP 47.00 45.90 48.50 49.75 Commercial Bank of Qatar (CBQK QD) 69.70 UP UP 67.30 66.50 69.80 70.70 Doha Bank (DHBK QD) 65.00 UP UP 63.90 62.00 65.70 66.40 Qatar Islamic Bank (QIBK QD)* 90.00 UP UP 89.00 87.80 90.70 91.80 Qatar International Islamic Bank (QIIK QD) 86.90 UP UP 86.10 83.00 89.00 90.50 Qatar Insurance (QATI QD) 76.90 UP UP 74.80 72.50 77.00 79.00 Al Khalij Commercial Bank (KCBK QD) 23.34 UP UP 22.90 22.49 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 89.70 UP UP 87.80 85.00 92.50 94.00 Al Meera Consumer Goods Co. (MERS QD) 185.00 UP UP 183.00 181.40 187.50 190.00 Industrials Industries Qatar (IQCD QD)* 188.30 UP UP 186.40 183.00 188.50 194.00 Qatar Electricity & Water Co. (QEWS QD) 184.50 UP UP 184.00 180.00 186.00 188.00 Gulf International Services (GISS QD) 89.50 DOWN UP 86.60 84.80 90.00 93.00 Qatari Investors Group (QIGD QD)* 69.40 UP UP 68.40 64.70 71.70 74.00 Real Estate Barwa Real Estate Co. (BRES QD) 39.00 UP UP 38.40 37.40 39.70 40.50 United Development Co. (UDCD QD) 25.75 UP UP 25.29 24.70 26.00 26.50 Telecom Ooredoo (ORDS QD) 147.50 FLAT UP 145.00 143.00 148.00 149.00 Vodafone Qatar (VFQS QD)* 18.84 UP UP 18.75 17.99 19.29 20.00 Transportat Nakilat (QGTS QD) 25.20 UP UP 25.00 24.61 26.00 26.50 Milaha (QNNS QD) 95.50 DOWN FLAT 95.10 93.00 96.50 98.30