Golden Agriculture: Chinese demand on the rise.

Price closed 1c lower at 57.5c today. The weakness is accompanied by a much reduced volume.  So, I am not too worried. Looking at the other indicators, we see the MFI forming a higher low, suggesting improving demand.  OBV is likewise rising, suggesting more robust accumulation activities.  The RSI has bounced off 50% which acted as support, suggesting a return of buying momentum. Any further weakness should see strong support at 55.5c as provided by the 100dMA.

The fundamentals are strong and the momentum oscillators are promising.  I would accumulate on weakness.

China's vegetable oil demand is entering a seasonal high, buoying edible oil and feedmeal prices, as the Mid-Autumn Festival and National Day holidays approach. 

"There is a supply reduction in oilseeds and this is leading to greater dependency on palm oil as supply growth is lagging behind demand," a senior trading executive at Malaysia-based major plantation company said. 

-By Shie-Lynn Lim, Dow Jones Newswires; +603 2026 1233; shie-lynn.lim@dowjones.com