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Daily Technical Trader – Qatar

Wednesday, 26 November 2014

Stocks Covered Today

Ticker Price Direction Tgt.

MCGS 133.50 Up 140.00

MERS 219.70 Up 224.00

QSE Index

Price % Ch. Vol. (mn)

Last 13,423.83 -1.9 9.6

Resistance/Support (Daily)

Levels 1st

2nd

3rd

Resistance 13,660 13,550 13,700

Support 13,450 13,240 12,900

QSE Index Commentary

Overview: Heavy selling took place after coming shy off the expected 13,800 resistance level. Moreover, selling commenced till the end of the session. The index is near a very important support level around the 13,450. If the index maintains above it, then we are looking at another continuation of the range we previously had. This can be seen by the Index dropping below its 50SMA on the daily while it closed below all three SMAs on the 30-minute chart. The above mentioned indicates the possibility of a further dip or a continuation of the range at best. Expected Target: 13,660 This is the first resistance facing the Index if the range scenario comes into play. Suggested Stop-Loss: 13,400

QSE Index (Daily)

Source: Bloomberg, QNBFS Research

QE Summary

Market Indicators 25 Nov 14 24 Nov 14 %Ch.

Value Traded (QR mn) 3,626.0 862.6 320.4

Ex. Mkt. Cap. (QR bn) 731.3 742.4 -1.5

Volume (mn) 31.1 11.1 180.2

Number of Trans. 11,657 7,933 46.9

Companies Traded 43 41 4.9

Market Breadth 10:31 8:28 –

QE Indices

Market Indices Close 1D% RSI

Total Return 20,021.52 -1.9 49.7

All Share Index 3,414.32 -1.7 51.2

Banks 3,424.81 -0.9 54.0

Industrials 4,378.87 -2.8 46.3

Transportation 2,379.41 -1.4 55.0

Real Estate 2,725.75 -1.3 49.2

Insurance 3,879.44 -4.2 46.0

Telecoms 1,457.53 -3.5 42.6

Consumer 7,701.74 -0.1 67.9

Al Rayan Islamic 4,556.14 -1.7 51.8

RSI 14 (Over Bought)

Ticker Close 1D% RSI

RSI 14 (Over Sold)

Ticker Close 1D% RSI

QSE Index (30Min)

Source: Bloomberg, QNBFS Research

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MCGS

Price % Ch. Volume

Last 133.50 0.68 86,602

Resistance/Support

Levels (QR) 1st

2nd

3rd

Resistance 135.00 136.00 142.00

Support 131.00 126.00 120.00

Commentary

Overview: The name is in a sustained uptrend thus far. On both time frames, the price settled above all moving averages. The MACD is still bullish although on a weaker note as evidenced from the MACD on the daily frame. The RSI is near the neutral zone looking for more strength in the price. All the above suggests that a move to the upside is possible, but it could be a weak one. Expected Target: QR140.00 – QR142.00 A break above the QR135.00 is needed and above the QR136.00 for the risk averse traders for a better confirmation on the price breakage, targeting the QR140.00. Suggested Stop-Loss: QR131.00 A drop below QR131.00 could drag the price to QR126.00.

MCGS (Daily)

Source: Bloomberg, QNBFS Research

MCGS (Hourly)

Source: Bloomberg, QNBFS Research

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MERS

Price % Ch. Volume

Last 219.70 -0.14 74,097

Resistance/Support

Levels (QR) 1st

2nd

3rd

Resistance 221.00 225.00 229.00

Support 217.00 214.00 211.00

Commentary

Overview: MERS dropped from its latest all-time-high peak by over 12%. The latest session ended with a doji candlestick. On top of that, the hourly chart shows a hammer candlestick. Both, the doji and the hammer, suggest indecision between traders. Indecision after a directional move is a sign of reversal to the opposite direction. The immediate previous direction was down for both time frames. Thus, the mentioned candlesticks expect to reverse the move to the upside. Price formation broke through a short-term downtrend line. Indicators, specifically on the hourly chart, are supporting the argument. The MACD is just below the zero line while the Histogram direction is up, suggesting the MACD could cross again above the zero line. Expected Target: QR224.00 – QR225.00 The candle formation needs a confirmation of price breaking the QR221.00. Suggested Stop-Loss: QR218.00 A drop below the level suggests a possible continuation of the correction to QR214.00 level.

MERS (Daily)

Source: Bloomberg, QNBFS Research

MERS (Hourly)

Source: Bloomberg, QNBFS Research

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Intra-day Fibonacci Support and Resistance Levels Daily Moving Averages* Support Levels Resistance Levels

Ticker Close 3rd

2nd

1st

Pivot 1st

2nd

3rd

50 SMA 100 SMA 200 SMA

QSE Index 13,423.83 13,201.72 13,328.99 13,407.62 13,534.89 13,662.16 13,740.79 13,868.06 13,730.04 13,273.09 12,635.70

Total Return 20,021.52 19,690.25 19,880.07 19,997.34 20,187.16 20,376.98 20,494.25 20,684.07 20,478.22 19,796.22 18,704.59

All Share 3,414.32 3,364.67 3,393.12 3,410.70 3,439.15 3,467.60 3,485.18 3,513.63 3,470.45 3,357.11 3,195.69

Al Rayan Islamic 4,556.14 4,494.20 4,529.69 4,551.62 4,587.11 4,622.60 4,644.53 4,680.02 4,661.11 4,483.63 4,096.10

Banks & Financials Services

MARK 49.00 48.07 48.60 48.93 49.47 50.00 50.33 50.87 54.98 54.21 48.32

CBQK 73.20 71.13 72.32 73.05 74.23 75.42 76.15 77.33 71.37 69.05 66.85

DHBK 58.50 56.30 57.56 58.34 59.60 60.86 61.64 62.90 60.06 59.23 61.27

QIBK 106.20 104.40 105.36 105.95 106.90 107.86 108.45 109.40 115.97 107.64 94.39

QIIK 85.70 84.97 85.35 85.58 85.97 86.35 86.58 86.97 88.56 85.96 81.50 Insurance

QATI 90.20 85.47 88.18 89.85 92.57 95.28 96.95 99.67 98.45 91.44 79.90

Consumer Goods & Services

MCGS 133.50 127.17 129.46 130.87 133.17 135.46 136.87 139.17 129.47 111.71 91.13 Industrials

IQCD 187.20 178.67 183.56 186.58 191.47 196.36 199.38 204.27 189.77 183.34 183.55

QEWS 191.00 188.73 190.03 190.83 192.13 193.43 194.23 195.53 187.81 186.50 181.17

GISS 111.20 105.73 108.64 110.43 113.33 116.24 118.03 120.93 120.98 111.94 95.19

QIGD 45.50 44.43 44.97 45.30 45.83 46.37 46.70 47.23 56.91 57.11 56.10

Real Estate

BRES 49.20 47.67 48.55 49.09 49.97 50.85 51.39 52.27 41.10 40.79 37.99

UDCD 27.80 27.23 27.42 27.54 27.73 27.92 28.04 28.23 28.81 27.53 25.13

ERES 18.53 18.10 18.26 18.36 18.52 18.68 18.78 18.94 19.50 20.59 21.27

MRDS 22.99 22.16 22.40 22.55 22.79 23.03 23.18 23.42 23.99 21.43 18.54 Telecommunication

ORDS 117.50 114.70 116.30 117.30 118.90 120.50 121.50 123.10 129.14 131.94 139.07

VFQS 18.00 17.49 17.75 17.91 18.17 18.43 18.59 18.85 21.16 20.27 17.20 Transportation

QGTS 23.90 23.58 23.76 23.88 24.06 24.24 24.36 24.54 24.32 23.80 22.91

QNNS 99.00 96.33 97.86 98.81 100.33 101.86 102.81 104.33 95.55 94.35 94.18 Source: Bloomberg, QNBFS Research; Note: Numbers in Italics denote moving averages that are above the given index level/stock price

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Definitions:

Candlestick: A chart that displays the high, low, opening and closing prices for a security in a single period. The body of the candle is made up by the opening

and the closing prices, i.e., the taller the body the greater the range between these two prices and vice versa. A colored candle denotes a closing price that is

lower than the opening price, while a white candle shows the opposite. The candlestick's shadows or wicks show the period's high and low prices and how they

compare to the opening and closing price. In general, the shape of the candle will vary upon the positions of the period's high, low, opening and closing prices.

Support: A level that could cause more buyers to step in in order to prevent the security from falling or causing the security price to head higher.

Resistance: An inverse of a support level. A resistance area or level could cause more sellers to step in in order to prevent the security from rising or causing the

security price to head lower.

SMA (Simple Moving Average): Is an arithmetic average, which calculates the average price of a security over a defined number of periods and is thus

considered a lagging indicator. SMAs used in our analysis refer to closing prices. In general, SMAs serve many purposes, such as a smoothing tool, an indicative

price direction and potential support/resistance levels.

Market Breadth: Breadth indicates the number of securities that have closed higher vs. the number of decliners in a particular exchange.

MACD (Moving Average Convergence/Divergence): Is a trading indicator, which shows changes in the strength, direction, momentum and duration of a trend in

a stock's price through a collection of three time series calculated from historical closing price data.

RSI (Relative Strength Index): Is a momentum indicator that compares a security’s price gains to its losses for a predetermined number of periods (we generally

use 14 periods). The RSI attempts to point out how a security, in relative terms, is in the overbought/oversold zone. Securities with a RSI above 70 could be

considered as overbought, and below 30 could be considered as oversold.

Pattern/Formation: Is a graphical presentation of a security’s price activity over a certain period of time. Formations come in different shapes (such as, head &

shoulders, triangles, flags, and so on). They can be used to identify potential trends, reversal of trends, price targets, entry and exit points, etc.

Fibonacci Retracements: Are horizontal lines that indicate expected areas of support/resistance for a security based on a predetermined price movement. These

levels are usually indicated by Fibonacci ratios of 23.6%, 38.2%, 50.0%, 61.8% and 100% from that particular movement.

Fibonacci Pivot and Intra-day Support/Resistance: A Pivot Point is generally used to formulate expected future support/resistance levels. From the base Pivot

Point, Fibonacci multiples of the high-low differential are added to form resistance levels and subtracted to form support levels.

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Contacts

Saugata Sarkar Abdullah Amin, CFA Shahan Keushgerian

Head of Research Senior Research Analyst Senior Research Analyst

Tel: (+974) 4476 6534 Tel: (+974) 4476 6569 Tel: (+974) 4476 6509 saugata.sarkar@qnbfs.com.qa abdullah.amin@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa

Sahbi Kasraoui Ahmed Al-Khoudary QNB Financial Services SPC

Manager – HNWI Head of Sales Trading – Institutional Contact Center: (+974) 4476 6666

Tel: (+974) 4476 6544 Tel: (+974) 4476 6548 PO Box 24025 sahbi.alkasraoui@qnbfs.com.qa ahmed.alkhoudary@qnbfs.com.qa Doha, Qatar

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