Thursday, March 26, 2009

Buy Golden Agri, Straits Asia - Sell Chartered

Golden Agri-Resources (GGR SP; S$0.30) – BUY

• The stock has broken out of its triangle pattern which is a positive sign. However, we still need confirmation before turning bullish. A rise above yesterday’s high of S$0.305 is the signal.

• Indicators are improving on the daily chart. MACD has just confirmed its golden cross while RSI also rises towards the upper band of the neutral zone.

• Once the S$0.305 is taken out, next resistance is at S$0.34 and S$0.38. Initial support is seen at its 30-day SMA at S$0.285 followed by S$0.27. Cut loss if prices fall below S$0.26.

Golden Agri-Resources Limited cultivates, harvests, processes, distributes, and sells crude palm oil and palm kernel. The Company also refines crude palm oil into cooking oil, margarine, and shortening for sale and distribution.

Straits Asia Resources (SAR SP; S$0.845) – BUY

• The stock may have bottomed out at S$0.56 in Nov-08 and is currently enjoying a short rally. However, it needs momentum to drive prices above the S$0.875 resistance trend line to instil more positives into the stock. Next upside target is at S$0.905.

• Technical landscape remains conducive. MACD is gaining momentum while RSI is neutral, suggesting more room to the upside.

• Investors looking for values may want to accumulate near its support at S$0.79. Cut loss if it breaks below S$0.74.

Straits Asia Resources Limited, through its subsidiary, mines for thermal coal on Sebuku Island.

Chartered Semiconductor (CSM SP; US$0.115) – SELL

• Still on its recovery path after broke down of its 30-day SMA. Although aggressive traders may see bargain hunting opportunities in it, we believe it is too early to conclude the selldown.

• It should at least close the S$0.125 gap before we would change our bearish view to a bullish one. Support is still weak at S$0.095 and S$0.07.

• However, indicators are showing improving trend. MACD is poised to stage a positive crossover while RSI is also rising. Upside is likely capped by its S$0.125 and S$0.15 resistances.

Chartered Semiconductor Manufacturing Limited provides comprehensive wafer fabrication services and technologies to semiconductor suppliers and manufacturers of electronic systems. The Company also produces digital logic, analog, and memory chips for applications as multimedia, communications, computing, and networking.

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