Alibaba (BABA) – Get the report stocks have been evolving hard lately. Shares of the e-commerce giant are up nearly 1% on Monday, but that comes after a painful end to the previous week.
In a reduced trading week, Alibaba did not deliver gifts to its investors. In contrast, it distributed coal, falling 13% on Friday and 15% a week.
Its low on Friday, shares fell nearly 18% as investors sold their hands.
At lows close to $ 211, Alibaba shares fell nearly 34% from the October 27 highs. What happened in less than two months?
First, the antiques stock market went public a few days before its public debut. Since Alibaba has a third of the stake in the company, that was a negative catalyst and the charts clearly show that.
Although the listing of antiques has been delayed due to regulatory issues, new regulatory concerns addressed to Alibaba were the latest catalyst for the sale.
As we approach 2021, it looks more like a buying opportunity than a selling opportunity. Management must agree, as the company increases the size of its stock repurchase plan.
Alibaba Stock Trading
Monthly chart of Alibaba shares.
Chart provided by TrendSpider.com
Because of the above negative catalysts, look at how Alibaba’s shares have stalled in the past two months. After getting up for seven months in a row, the oxen received a painful bowel movement.
Still, not all hope is lost.
First, stocks find support in their 21-month moving average. He is also finding assistance in the 2018 high of $ 211.70. Shares fell near that mark on Friday, dropping to $ 211.23.
While the high from 2018 seems a bit irrelevant, look at how remarkable this area was in late 2019 and the first half of 2020. This area was problematic, highlighted by all the wicks above this mark, but no solid closes above $ 211.70.
It lasted six months until this summer.
Lowering about 30% of the maximums for a high-quality growth company seems like a safe place to immerse your feet in water. Conservative traders can measure risk against the current low and look for a rebound.
Closing daily below $ 211, it could bring the weighted average price measure in monthly volume close to $ 197. It could also jeopardize the 200-week moving average, currently near $ 187 (not shown in the chart above).
These would be areas of interest to the advantage.
On the upside, look for a rebound back to the 50-week moving average of about $ 240, followed by the currently ten-month moving average of about $ 246. Near the latter, the 200-day moving average also comes into play.
While it may take some time for a sustainable recovery to take place, it seems like a reasonable decline for patient oxen.