Courage Marine: White candle day.

On 15 Sep, I asked, "Is Courage Marine awakening? If the resistance at 19.5c is taken out convincingly, it could very much be the case." Today, this took place on rather high volume. Of the 3,882 lots traded today, 2,999 lots were buy ups, of which 2,172 lots were buy ups at 20c.  Could the remaining sell queue at 20c be mopped up tomorrow? Perhaps.

The MACD is rising in positive territory signalling a return of positive momentum. The OBV shows a sharp move upwards suggesting increased accumulation. The MFI formed a higher low several sessions ago and has risen into overbought territory.  The RSI has the same trend.  Demand and buying momentum are both positive but seeing the indices being in overbought territories sends a cautionary note.  Any upside could be limited.  If 20c is take out, the next resistance could be at 21c, the high of 22 Jun 10.

However, in exceptionally bullish situations, both MFI and RSI could stay overbought for much longer. Could it happen in the meantime? It could but it does not seem very probable.

Related post:
Courage Marine: Awakening.

Golden Agriculture: Which way would it go?

CPO price spiked 4.31% today or RM112 to close at RM2,708.  It is on track to challenge the previous high, it seems. Strong buying by Chinese purchasers and short covering were cited as the reasons.

Palm oil shipments to China will likely rise 3% this month compared with August, as low stock levels of around 400,000 tons at ports in China spurred buyers to increase purchases, a Beijing-based vegetable oils analyst said. 

-By Shie-Lynn Lim, Dow Jones Newswires,
September 17, 2010 06:55 ET (10:55 GMT.

Golden Agriculture's share price gained 1c to close at 59c today. This was, however, on the back of rather modest volume. I have suggested in earlier posts that its share price seems to be trapped in a symmetrical triangle. Immediate support is at 57.5c, a many times tested candlestick support and coincides with the rising 20d and 50d MAs. If this goes, 55c should be a very strong support as that is where we find the 100d and 200d MAs.  It is also where we find the uptrend support line now.  To move higher, price has to overcome resistance at 60c.  This is also where we find the upper line of the symmetrical triangle which would present some strong resistance.

Currently, the MFI and RSI are both bordering on overbought and OBV is flat. Technically, the picture is not strong. An appreciation in price on higher volume is required to break resistance at 60c, probably.  However, it would also push the MFI higher into overbought territory.  If this happens, I expect to find strong resistance at 62c.  This is a many times tested resistance level in April 2010 but ultimately proved too strong to be taken out.

Related post:
Golden Agriculture: Trading Buy by OSK.

ASTI: Breakout, almost.

A friend called me and asked if it is too late to buy some shares of ASTI.  Yesterday, I said "I see resistance at 12c which was tested several times in recent months.  It is, however, also interesting to note that we might be seeing the formation of an ascending triangle here with 12c being the top of the formation.  If  the resistance at 12c is taken out, I see immediate resistance at 13.5c with a near term target of 15c." Today, 12c resistance was weakened as price briefly touched 12.5c before ending the day at 12c.  This means that 12c is still resistance and we need to see if it could be taken out in the coming sessions.

So, should my friend buy some shares of ASTI at 12c? Buying at 12c would be buying at resistance. Not a very good idea. However, the very high volume today which accompanied the buy ups is encouraging.  Of the 20,050 lots that changed hands, 15,573 lots were buy ups. 10,369 lots were bought up at 12c.  Could this momentum continue? Let's look at the momentum oscillators for clues.

The MFI has formed a higher low.  So has the RSI.  The MFI is just going into overbought territory while the RSI has spiked into overbought territory.  OBV has also spiked upwards.  Demand is rising. Buying momentum is strong but overdone.  Accumulation is in full swing.  Overall picture looks good.  There is a good chance of a follow through and if it happens, we could see 13.5c tested.  Otherwise, supports could be tested once more. It would be safer to buy in then.

Related post:
ASTI: A doubling of share price in time?

Nil-paid rights and excess rights: Some numbers by LP.

LP, blog master of Bully the Bear, and owner of the infamous cbox therein, has this to share:

I think that people don't understand that the price of the nil-paid rights (right shares that are entitled to you based on your holdings upon XR of the mother share) is priced as this:

Price of mother share - 0.155

If it's lower than the above formula, it opens a chance to arbitrage the difference by buying the nil paid rights or shorting the mother share. Either way, equilibrium will be achieved to bring the price of the nil-paid rights back to the stated formula.

So, if the mother share is trading at 0.225, the nil-paid rights will be priced at 0.07. You pay 0.07 PLUS brokerage to get the nil-paid rights, then you pay at the atm 0.155, so the price will be 0.225 excluding brokerage.

Or on the other hand, if you can buy the nil-paid rights at 5 to 6 cts, you are buying the mother share at 0.205 to 0.215. Good deal to me even if you have to pay brokerage!

If you don't want to do this during the nil paid rights trading period, you can always opt NOT to pay any brokerage and paying 0.155 to apply for excess rights. But you might not get it.