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Wilmar: Smart money outflow is reversing?

Saturday, December 8, 2012

Anyone investing in Wilmar for the longer term would be encouraged by the counter's weekly chart.

Even as share price continues its basing process which has been going on for months, Chaikin Money Flow (CMF) shows that the outflow of funds has ceased. With bearish pressure dissipated, any positive news could send share price up quite abruptly.

Bollinger bands are also constricting to a point where we could expect a violent movement in share price. So, which way? Up or down? Based on the CMF, dare I hazard a guess? I would guess "up".

This could simply be a rebound if it should happen, a rebound which could see price capped by the declining 50w MA which is currently at $4.00. Immediate resistance is at $3.20.

Related post:
Wilmar: A rebound or something more?


RayNg said...

Hi AK,

When we use daily chart, the MA is 20/50/200 days.

When we use weekly chart, should we use 4/10/40 instead of 20/50/50 week MA?

AK71 said...

Hi RayNg,

I always use 20, 50, 100 and 200 on both the daily and weekly charts. It is a matter of convenience for me. :)

AK71 said...

Wilmar’s (F34.SG) sale of its 15% Fortune Gas Investment stake for US$60 million ($73.2 million) was at a decent return, Phillip Securities says, noting the shares were purchased at US$36 million in 2008.

It estimates a realised gain of US$24 million, equating to a 13.6% per annum return. It estimates the deal was valued at 22x profit before tax, which it views as decent. But it adds, the financial impact on Wilmar is not substantial at less than 3% of the house’s FY12 earnings estimate; it isn’t adjusting its forecasts. It keeps an accumulate call with $3.47 target.

“Albeit CPO prices and China crushing margins may still remain weak in the near-term, we are positive on the company’s long-term outlook. In fact, we are starting to see quarterly recovery from the recent 3Q12 results, and we expect sequential improvement with a stronger 2H12 driving recovery in both earnings and share price.” The stock is up 1.6% at $3.19.

Dow Jones & Co, Inc
Wednesday, 19 December 2012 13:18

AK71 said...

KUALA LUMPUR: Malaysia will allow crude palm oil exports at zero duty in January as the world’s second-largest producer seeks to reduce record stockpiles that drove prices to a three-year low last week.

The average price for calculating tax on shipments was set at RM2,147.81(US$702) a tonne for January, the customs department said in a notification yesterday. That’s below the minimum threshold of RM2,250 a tonne for tax to be applied, it said.

Palm oil, used in everything from instant noodles to soap bars, slumped to RM2,217 a tonne on Dec 13, the lowest price since November 2009, as output in Indonesia and Malaysia, the biggest producers, outpaced demand from China and India. Malaysia announced a cut in taxes and abolition of a duty-free export quota in October after inventories surged. The new tax rates will range from 4.5% to 8.5%, rising as prices climb from RM2,250 a tonne. The existing levy is 23%, according to the government.

“Export demand will pick up gradually in the coming days, and may ease stockpiles a bit,” Chung Yang Ker, an analyst at Phillip Futures Pte, said by phone from Singapore. “The current price level is too low for producers.”


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