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TECHNICAL ANALYSIS: QE INDEX AND KEY STOCKS TO CONSIDER
QE Index: Short-Term – Neutral
The QE Index fell for the second straight session and shed around 43
points (-0.35%) to settle below the 12,350.0 level. The index has
been repeatedly failing to hold on to its gains above 12,400.0 since
the past few days on the back of profit-booking. Meanwhile, the index
has its next support near the 12,300.0 level. This level if breached on
a closing basis may pull the index to test 12,220.0. However, if the
index manages to stay above 12,300.0 it may attempt a rebound.
Vodafone Qatar: Short-Term – Pullback
VFQS developed a shooting star candlestick pattern on Thursday and
further declined yesterday confirming this trend reversal pattern which
was bullish until now. Meanwhile, the stock is sitting exactly on its
immediate support of QR17.70. Traders could consider selling the
stock if it trades below QR17.70 for a target of QR16.89 with a stop
loss of QR18.0. Further, both the momentum indicators are providing
bearish signals indicating a likely correction from the current level.
Al Rayan Islamic Index: Short-Term – Neutral
The QERI index gained marginally around 0.05% to close at
4,111.93. The index momentarily moved below the 4,100.0 level but
bounced back as buyers stepped in and quickly offset the weakness.
Meanwhile, the index faces its resistance at 4,148.0 whereas
intermediate support is seen at 4,100.0. Only a move above or below
these levels on a closing basis may decide the next direction of the
index, until then it may continue to oscillate.
Gulf International Services: Short-Term – Upmove
GISS built on its gains and advanced 1.23% yesterday. Moreover, the
stock cleared its important resistance of QR98.0 on the back of large
volumes indicating rising optimism among traders. We believe the
stock may continue its bullish momentum and may proceed ahead to
test QR100.0. Further, the RSI is in buy zone, while the MACD is
diverging away from the signal line in a bullish manner. However, any
retreat below the QR98.0 level may result in a pullback.
Al Khalij Commercial Bank: Short-Term – Upmove
KCBK advanced further and gained around 1.80% yesterday.
Moreover, the stock surpassed its resistances of the 21-day moving
average and QR22.0 in a single trading session which is a positive
signal. We believe this strong breach of resistances has bullish
implications and provides an upside target of QR22.35. However, a
dip below QR22.0 may halt its upmove. Meanwhile, both the
momentum indicators look strong with no immediate reversal signs.
Qatar Electricity & Water Co.: Short-Term – Pullback
QEWS failed to make any further headway above QR186.0 and
reversed penetrating below the 21-day moving average and QR182.0
levels in a single swoop. Moreover, the stock developed a bearish
Marubozu candle pattern indicating a likely continuation of this
pullback. Further, the negative slop on the RSI is indicating
weakness. We believe the stock may continue to drift lower and test
QR178.90. However, a move above QR182.0 may attract buyers.
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
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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
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*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
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.
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) 12,333.54 DOWN DOWN 12,300.00 12,216.75 12,375.03 12,465.50
Al Rayan Islamic Index (QERI Index) 4,111.93 DOWN DOWN 4,100.00 4,065.50 4,148.08 4,211.12
Banks and Financial Services Banks and
Masraf Al Rayan (MARK QD) 50.00 DOWN DOWN 49.75 48.50 51.00 52.60
Commercial Bank of Qatar (CBQK QD) 65.40 UP DOWN 64.92 63.67 65.75 66.30
Doha Bank (DHBK QD) 57.00 DOWN DOWN 56.50 55.80 57.40 58.10
Qatar Islamic Bank (QIBK QD) 92.30 FLAT FLAT 90.70 90.00 93.90 95.10
Qatar International Islamic Bank (QIIK QD) 82.80 UP DOWN 81.70 80.70 83.00 86.58
Qatar Insurance (QATI QD) 81.00 UP UP 80.00 79.00 81.00 81.40
Al Khalij Commercial Bank (KCBK QD)* 22.10 UP DOWN 21.87 21.49 22.35 22.99
Consumer Goods and Services Consumer G
Medicare Group (MCGS QD) 83.20 UP DOWN 81.90 79.00 83.40 86.00
Al Meera Consumer Goods Co. (MERS QD) 174.20 UP DOWN 173.89 164.00 179.00 180.00
Industries Qatar (IQCD QD) 174.00 DOWN DOWN 173.90 171.00 174.90 180.10
Qatar Electricity & Water Co. (QEWS QD)* 180.00 DOWN DOWN 178.90 176.27 182.00 185.20
Gulf International Services (GISS QD)* 98.40 UP UP 98.00 97.00 100.00 101.50
Qatari Investors Group (QIGD QD) 56.00 DOWN DOWN 54.40 50.00 56.10 57.00
Real Estate Real Estate
Barwa Real Estate Co. (BRES QD) 38.80 DOWN DOWN 38.40 38.05 40.10 41.00
United Development Co. (UDCD QD) 24.55 FLAT DOWN 24.00 23.42 24.75 25.30
Ooredoo (ORDS QD) 128.00 DOWN DOWN 125.80 124.37 128.00 130.00
Vodafone Qatar (VFQS QD)* 17.70 DOWN DOWN 17.70 16.89 18.75 19.29
Nakilat (QGTS QD) 21.90 DOWN DOWN 21.80 21.45 22.19 22.45
Milaha (QNNS QD) 94.40 UP FLAT 93.10 92.00 95.10 96.50