Golden Agriculture and First Resources.

Golden Agriculture is closing in on the 100dMA as it ended the day at 71c today on high volume. We could very well see the support provided by the 100dMA tested at 70c in the next session. If it should break, next support could be found at 66c where the rising 200dEMA would be approximating soon.  The 200dEMA, being a long term MA, should be able to provide a much stronger support in case of further decline in price.

The MACD is falling in negative territory. Both MFI and RSI are also declining in overbought territories. The OBV shows clear distribution ongoing. The time to buy some shares in Golden Agriculture could be near.

First Resources declined with a vengeance yesterday on extremely high volume but volume dried up today as price declined another 4c. Could price decline further next week? It certainly could but with volume drying up, drastic price decline similar to what was witnessed yesterday is less likely to happen again.

For anyone thinking of initiating a long position in the counter, the 100dEMA at $1.38 and the 100dMA at $1.35, if tested, could be nice entry prices.

See analysis by DBS Group Research here.

First Resources drop a buying opportunity. Major shareholder Eight Capital sells 75 million ordinary shares and Citigroup places 15 million treasury shares held by the company at $1.48 each.
Thursday, 20 January 2011

© 2011 - The Edge Singapore

Related post:
Golden Agriculture: Looking to the 100dMA.

Raffles Education: A new property play?

Raffles Education's recent stellar performance in the stock market is now explained. It "has identified a property developer in Singapore to co-develop the Oriental University City (OUC) land to monetise its SGD394m investment in the university city." Read article in Next Insight here. This development is unexpected and could also explain the constant insider buying of the company's shares in the last few months.

Technically,the OBV indicates that accumulation is ongoing while the MFI and RSI are in overbought territories. Although in extremely bullish situations, they could remain overbought for a long while, it is wise to stay cautious and not chase the price higher.

The 200dMA has flattened at 30.5c and it could be resistance turned support. Of course, it would be nice if this could be confirmed if a correction in price happens.

I have fully divested my smallish investment in Raffles Education and extend my best wishes to all who are still vested.

Raffles Education +4.7%; BNP bullish; keeps Buy rating on the stock with a $0.33 target. $0.350 is likely the near-term cap.
Friday, 21 January 2011

© 2011 - The Edge Singapore

Related post:
Raffles Education: Broke resistance.

CapitaMalls Asia: Pulling back on low volume.

I bought more shares of CapitaMalls Asia today at $1.91 as its share price retreated to test its support at $1.90. I like the picture which is forming which suggests a low volume pull back taking place.

With a sell signal appearing on the MACD histogram and the MACD still in negative territory, although it has been rising above the signal line, one could not be faulted for staying cautious. Look at the RSI and it is clear that the trendline support is broken. However, look at the MFI which takes in not just price but volume as well, support is just being tested.

Whether the uptrend support at $1.90 holds up is important for the counter in the near future. If it breaks, the nascent uptrend is in jeopardy and I would turn cautious  If it holds up, price could bounce off and move higher. With the rising 20dMA on course to meet the falling 50dMA, expect some volatility but the technicals do have an upward bias for now and a golden cross is in the works.

Related post:
CapitaMalls Asia: A sustainable reversal?

Golden Agriculture: Looking to the 100dMA.

Golden Agriculture's share price continues to weaken with a gap down today forming a wickless black candle on heavy volume. Price closed at 74c which seems to be a relatively strong support in the immediate future. Some asked if I would consider buying in at 74c. I don't think so.

Of course, price could rebound after a hard sell down. The RSI has entered the oversold region with the MFI just bordering on oversold. However, look at the OBV which shows sharp distribution and this could continue as the MACD dipped into negative territory. If a rebound happens, it would probably do a gap cover to 76c where it would meet with resistance.

On 15 January, I asked "How low could the price fall to? No one can say for sure but drawing a trendline support linking the lows of 30 Sep and 8 Oct coincides with the rising 100dMA and, to me, this suggests a much stronger support at this level and would be a more ideal entry point. The 100dMA is currently at 68.5c." The 100dMA is closing in on 70c and that is when I might consider adding to my long position if there are clearer signs to do so, not sooner.

Golden Agri down on J.P. Morgan report
Thursday, 20 January 2011

© 2011 - The Edge Singapore

Related post:
Golden Agriculture: Short term uptrend broken.