Sunday, April 13, 2008

Sime Darby Bhd

The KLSE index staged a comeback for the week to close at 1246.79. That is about 2% rise for this week.

Sime Darby Bhd, one of the biggest palm oil producer closed at 9.10 on volume of 26.6 million.

The stock price reached a high of $13.4 on 11 Jan 2008 and set a low of $8.50 on 7 Apr 2008. The stock price has been affected by a decrease in palm oil prices which reached a high of RM4,204 a tonne on Mar 4.

Looking at the technical charts,

The ADX is turning down from high values which show that the down trend is weakening. The stock price will most likely move sideways. For reversal in trend, the +DI needs to cut above the –DI and the ADX value needs to be above 30 for a good up trend to resume.

The MACD line made a crossover on 28 Mar 2008. The low established on 7 Apr 2008 was not matched by a low in the MACD histogram. This is positive for the Bulls as MACD divergence usually mean the stock will move up in the near future.

With the Dow industrial average down 256 points on Friday session, the stock price may test $8.50 support line next week. Resistance is at $9.50.

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