Alibaba Tries to Hold Long-Term Support
Chinese technology stocks have suffered a violent correction in the last month as Beijing tightens regulations on the sector. As a result, some of most dynamic growth names in recent years are now potential values.
Alibaba in particular stands out because of two patterns on its weekly chart.
First, the hammer candlestick that was just completed.
Second is the long-term price area around $195-210. There were peaks in this zone starting in early 2018 through September 2019. It was also the final support level before the big push above $300 began last year.
In some ways, this idea is less about the chart and more about sentiment. Negativity has surged in these stocks lately, but last week the Chinese government took steps to calm the fears. (Officials held a call with banks like Goldman Sachs.) It’s not clear that things have returned to normal, but prices might have fallen enough to think about positions.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Alibaba in particular stands out because of two patterns on its weekly chart.
First, the hammer candlestick that was just completed.
Second is the long-term price area around $195-210. There were peaks in this zone starting in early 2018 through September 2019. It was also the final support level before the big push above $300 began last year.
In some ways, this idea is less about the chart and more about sentiment. Negativity has surged in these stocks lately, but last week the Chinese government took steps to calm the fears. (Officials held a call with banks like Goldman Sachs.) It’s not clear that things have returned to normal, but prices might have fallen enough to think about positions.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
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