LMIR: Weakness is an opportunity.

LMIR closed 1c lower at 49.5c today, supported by the 50dMA.  Forming a wickless black candle on increased volume, more downside looks probable.  However, with the 20d and 50d MAs merging and rising in tandem, we should see support at 49c.  The trendline support nears 49c next week and 49c also happens to be a 38.2% Fibo support.

There is obvious distribution taking place today and this can be easily seen in the OBV but the longer term picture of accumulation is intact.  MFI continues to form lower highs and higher lows and the index does not indicate any trend per se.  The MACD turned down towards the signal line and we will have to wait and see if a bearish crossover takes place or if there will be a reversal.

I bought more units at 50c and 49.5c today.  I will now wait to see if the 49c support holds up next week.  If the 49c support breaks, we might see LMIR moving lower to test the recent low of 47c or even move to test the rising 200dMA as support.  The 200dMA is currently at 46c.

I mentioned that I have been waiting for months to buy more at 46c and I am probably not the only one.  If LMIR does test the 200dMA at 46c, I'm going to buy many more units to lock in a yield of almost 11%.  This weakness presents an opportunity to accumulate.

Related post:
LMIR: More units at 10% yield.

Golden Agriculture: Approaching supports.

The price of crude palm oil declined RM57 or 2.2% today to close at RM2,538.00.  Since testing the three months high of RM2,710, CPO's price has been in retreat.  There is a danger that we might see the formation of a double top.  This is quite clear in CPO's three month chart.  The neckline? RM2,400.00.  This situation bears watching.

On 12 March, in a post titled, "Golden Agriculture: Waiting for support", I said that "The ascending 20d and 50d MAs have merged and should provide initial support at 55c. I have also drawn a line connecting the previous two lows which would give an indication of where the trendline support is in the next session, 54c. If this uptrend is violated, the ascending 100dMA would be called upon as support, 51c." 

These observations are more or less still valid except that the trendline support is now higher up at 54.5c which also coincides with the gap support.  Interestingly, 54.5c has been a gap support and gap resistance in the recent past before 5 March. It is also a many times tested candlestick support and resistance level.  This implies that it should be a strong support if tested.

Golden Agriculture's price retreated 1c today to close at 56c.  This is after starting at a high of 57.5c in the morning.  So, we have a wickless black candle today.  Very bearish.  The MACD looks set to make a bearish crossover with the signal line. 

Expecting further weakness in price, I am ready to accumulate at supports.  However, if the price breaks through all the near term supports I have identified including 54.5c which I expect to be a strong support, I would wait to buy more closer to the rising 100dMA which would be around 51.5c next week.