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Golden Agriculture broke all supports today on higher volume to touch a low of 53c before closing at 54c. That the OBV and MFI both show obvious decline indicates heightened selling pressure.
The rising 100dMA is at 52c which happens to be the recent low as well. This should provide some support in the event that the price continues to decline. This is where I will queue to buy more but I will not break my piggy bank because if this breaks, the rising 200dMA is at 47c. That is some way to fall.
Is this a whipsaw or the start of a downtrend? It is hard to say at this point in time but it is never wrong to be cautious especially when today's decline happened on the back of much increased volume.
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From Budi Wijana, Vice President Director, PT SMART Tbk, in response to the Indonesia Stock Exchange’s letter dated 18 March 2010:
"Nestle has recently announced that it has discontinued the Company as its supplier for Nestle’s manufacturing in Indonesia arising from a recent Greenpeace’s report based largely on earlier related allegations. We will continue our dialogue with Nestle and seek ways to verify the Greenpeace’s report.
"We would like to reiterate our commitment to the production of sustainable palm oil, our full compliance with the Indonesian Government rules and regulations, and our adherence to the Roundtable on Sustainable Palm Oil’s principles and criteria for sustainability.
"Sales to Nestle represented approximately 0.2% of the Company’s total sales in 2009. The outstanding contracts will be fulfilled by Nestle. Nestle’s decision will not have a material impact on the Company’s financial condition because the size of its purchases is not significant and our products have ready buyers and a strongly established and growing demand base in both the local and export markets."
http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_06519F0A59E673D3482576EB0038E4A9/$file/BEINestlePutuskanKontrakNo007190310EngFinal.pdf?openelement
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