Golden Agriculture: Broke supports on higher volume.

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

Healthway Medical: Touched 16c.

A declining MFI shows weakening buying momentum but a flat OBV says that there is no distribution.  So, the overall picture is one where selling is being absorbed quite well.  This is all the more impressive when we realise that the volume is the highest in seven sessions.  However, the volume is still lower than ten sessions ago when price action hit a high of 18.5c.  Therefore, overall, the picture of a low volume pullback is still intact.

Forming a doji at 16c today is meaningful.  I have suggested that 16c is an important support as it is the midpoint of the recent high at 18.5c and the recent low of 13.5c.  If 16c holds up, we would have the formation of a higher low but if 16c breaks, Healthway Medical could see the formation of a double top.  I would keep an eye on 16c.  It is critical that it holds up.

Related post:
Healthway Medical: A beautiful symmetry again.

LMIR: Bought more at 48c.

LMIR's chart looks like it might be in the early stages of a symmetrical triangle.  Since late January, the price action has been trapped between 47.5c and 51c.  Stochastics has turned up and seems ready to emerge from the oversold region.

Using Fibo lines to determine where the supports are, we see clearly that 48c and 47.5c are important supports.  47.5c is the support to watch.  If it breaks, the symmetrical triangle is out the window and we have to see if the rising 200dMA holds up well as the new support then.

As the reason for buying more units in LMIR recently is to lock in a yield of 10% per annum, I am unfazed by any near term weakness in the counter's price.  In fact, I bought more at 48c.

CapitaMalls Asia and AusGroup.

CapitaMalls Asia: Price closed below the trendline support today at $2.29, after touching a low of $2.28 (the 38.2% Fibo line).  Technically, this is supported by the declining 50dMA.  The decline is on the back of low volume with the MFI and OBV more or less unchanged.  These signs suggest that a benign low volume pullback is taking place.  However, this does not mean that price would not continue to drift downwards.  If the $2.28 support is broken, the next support level is at $2.25 which would see me buying more.

AusGroup:  Nice up day with price closing at resistance provided by the 50dMA at 60c after hitting a high of 61.5c on the back of increased volume.  MFI and OBV have both turned up which suggest that buying momentum and accumulation are both moving up a notch. 

We have a buy signal on the MACD as well and it seems poised to cross above zero. Resistance is provided by the merged 100d and 200d MAs at 63c. Initial support is at 58.5c. A negative is the long wick on the white candle which suggests selling later on in the session today.  This adds a cautionary tone in an otherwise positive picture.