Sino Agro Food Inc (fka SIAF)

[DougS.]

Here is a very simple buy/sell strategy from just moving average crossovers and oscillator divergences. You want to use a set of rules that don’t trigger a bunch of false buy signals and that can be verified through backtesting. It works this way:

1. The stock must cross the 13-day EMA
2. The 13-day EMA must cross the 50-day EMA
3. The oscillators must show a positive divergence from price through at least one month of prior trading.

Buy signals are shown in the orange circles. As you can see below, this has only yielded 3 buys in the last 4 1/2 years! All three buy signals were also very close to bottoms which isn’t normal but I’ll take it. The first two preceded SIAF’s two largest moves. So it has a very, very good track record with this stock.

What the chart says is open to interpretation. What it tells me is that there are some positive undercurrents to this stock that aren't obvious by eyeballing the chart. It also tells me that the odds of future price appreciation have become more and more probable even in the face of dilution. But how much? That's for other people. I'm not going to guess.