Golden Agriculture and Saizen REIT

Golden Agriculture (50.5c): Unable to close above the 50dMA today at 52c is not a good sign.  Trade volume although not expanding very much remains significant.  The fact that the MFI is bordering on the oversold region provides little comfort as it could stay oversold for a while if sentiments remain bearish.  Once again, the critical support level at 50c is in focus.  Investors with long positions in this counter like myself would want to see this support level holding up.  Fundamentally, the prospects for crude palm oil (CPO) in 2010 remain positive.  The price of crude oil will also appreciate in time as economic recovery this year gains traction on a global scale.  Golden Agriculture will remain a major beneficiary in such a situation.

Saizen REIT (16c): Another low volume day with the MFI bouncing at the 50% mark.  There is little to say here.  I am still in accumulation mode where this counter is concerned.

Healthway Medical: Downward drift.

Healthway Medical closed at 15c today on reduced volume.  MFI has also stopped declining.  All these suggest that it is more closely aligned with a classic case of low volume pull back and that it is not experiencing a massive sell off.  This does not mean that its price will stop declining, however. 

It is common TA wisdom that without any expansion in volume, any upward move in price is unsustainable.  Another common bit of TA wisdom is that in the absence of any meaningful expansion in buying activity, the chances of a continual downward drift in price is higher even if there is no massive selling.

The price is at the 15c support level now.  It is likely to test the 14c support in time although a flattened MFI, at this point in time, suggests that it might not happen in a hurry.  Of course, if there is any positive catalyst in the near future to bring buying activity back in force, things might all surprise on the upside.  This possibility seems remote for now.

Personally, I partially divested at 16c this morning the shares I bought as a hedge at 16.5c two weeks or so ago, booking a small loss in the process.  After this divestment, the Healthway Medical shares I am left with are mostly those bought between 10c to 13c last year.  These, I am quite comfortable holding for the longer term as they are actually fully paid for with the gains from divesting 80% of my original investment in the company.