12 May Daily technical trader


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12 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 gains moving up around 34 points (0.26%) for the second straight session and inched closer to the 13,000.0 level. The index made a gap-down opening and recouped all its losses, subsequently recovering from its day’s low of 12,717.04. This was a nice display of strength by the bulls as the index rallied around 278 points from its intraday low. We believe the index may continue its bullish momentum and proceed toward an all-time high. Masraf Al Rayan: Short-Term – Upmove MARK gained 0.92% and continued its upmove on the back of large volumes indicating rising buying interest. The stock is gradually approaching toward its next resistance of QR49.75. A move above this level may spark additional buying interest, which may push the stock further to test QR51.80. However, a dip below QR48.50 may pull the stock back into the congestion zone. Meanwhile, the RSI is moving up strongly toward the overbought territory. Al Rayan Islamic Index: Short-Term – Neutral The QERI Index rose 0.14% and moved higher for the second consecutive day. The index momentarily dipped below the 4,250.0 level, but later recuperated its losses as buyers stepped in and quickly offset the weakness. However, unfortunately for the bulls the index ended the session below the 4,302.0 level. We believe until the index stays below this level it may continue to be range-bound. On the flip side, a move above 4,302.0 is needed to gain further momentum. Qatar Electricity & Water Co.: Short-Term – Upmove QEWS cleared the resistance of QR186.0 and continued to advance yesterday. The stock is currently sitting exactly at its resistance of QR188.0. A move above this level may witness a further rally and the stock may test QR190.0. However, any failure to move above QR188.0 may result in a pullback and the stock could move down toward QR186.0. Meanwhile, the RSI is moving up in a bullish manner, while the MACD is showing signs of recovery. Gulf International Services: Short-Term – Uptrend GISS continued its rally and breached the important resistance of QR93.0 after consolidating below it over the past few weeks. Notably, volumes were also large on the breakout which is a positive sign. The recent price action suggests that the stock may further extend its rally and advance toward the QR95.0 level. However, traders may need to keep a close watch on QR93.0 for any reversal signs. Meanwhile, both the indicators are providing bullish signals. Qatari Investors Group: Short-Term – Pullback QIGD penetrated below its support of QR68.40 and has been in correction mode since topping the rally at QR72.20. We believe the stock may continue to drift lower and test the support of the 21-day moving average. Any sustained weakness below this level may drag the stock further down to test QR64.70. However, if the stock manages to move above QR68.40 it may attract buyers. Meanwhile, both the RSI and the MACD lines are indicating further correction.
  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) 12,995.05 UP UP 12,939.80 12,854.20 13,000.00 13,070.00 Al Rayan Islamic Index (QERI Index) 4,287.93 UP UP 4,247.34 4,200.00 4,301.89 4,318.00 Banks and Financial Services Banks and Masraf Al Rayan (MARK QD)* 49.35 UP UP 48.50 47.00 49.75 51.50 Commercial Bank of Qatar (CBQK QD) 69.10 UP UP 68.40 67.30 69.80 70.70 Doha Bank (DHBK QD) 65.50 UP UP 63.90 62.00 65.70 66.40 Qatar Islamic Bank (QIBK QD) 88.80 UP UP 87.80 86.00 89.00 90.70 Qatar International Islamic Bank (QIIK QD) 87.30 UP UP 86.10 83.00 89.00 90.50 Qatar Insurance (QATI QD) 74.00 DOWN UP 72.60 71.00 74.80 76.00 Al Khalij Commercial Bank (KCBK QD) 23.18 UP UP 22.90 22.49 23.49 24.00 Consumer Goods and Services Consumer G Medicare Group (MCGS QD) 88.70 UP UP 87.80 87.00 90.00 92.00 Al Meera Consumer Goods Co. (MERS QD) 187.20 UP UP 185.00 183.00 187.80 190.00 Industrials Industries Qatar (IQCD QD) 188.50 UP UP 186.40 183.00 188.50 194.00 Qatar Electricity & Water Co. (QEWS QD)* 188.00 UP UP 186.00 184.00 188.00 190.00 Gulf International Services (GISS QD)* 93.40 UP UP 93.00 90.00 95.00 97.00 Qatari Investors Group (QIGD QD)* 68.00 UP UP 64.70 61.30 68.40 71.70 Real Estate Barwa Real Estate Co. (BRES QD) 37.90 DOWN UP 37.40 36.80 38.40 39.20 United Development Co. (UDCD QD) 26.00 UP UP 25.29 24.70 26.00 26.50 Telecom Ooredoo (ORDS QD) 147.40 FLAT UP 145.00 143.00 148.00 149.00 Vodafone Qatar (VFQS QD) 18.24 UP UP 17.99 17.30 18.75 19.29 Transportat Nakilat (QGTS QD) 24.88 UP UP 24.20 23.90 25.00 25.90 Milaha (QNNS QD) 96.90 DOWN UP 96.50 95.10 98.30 100.10