I’ll be just doing a quick update into the latest update on Baba, so this won’t be a long post.
Long time readers know that I’ve been a long admirer on Alibaba stocks, having a vested position myself together with its closest rival, JD Inc.
But the stock was still making lower lows so while they are already cheap by its own valuation, it can get cheaper.
On 26th Jun 2021, I alerted in my Facebook page that the company had a breakout of its 7-months long triangle engulfing consolidation since it last hits the peak back in Nov 2020.
The shares went up 4.6% on that day and this was not by coincidence that the market decides it should breakout that day. I think there is something that is brewing over next few weeks.
I also mentioned that with such a breakout after a long hiatus, we are likely to see the price action testing back the $220 mark.
For the next couple of days, we see Baba shares retreating back slightly, right where it closed last night at $221.87.
This is right at the congruent line in between the EMA20 and EMA50 which is sitting nicely at around $220 and both support lines are converging upwards to meet at the intersection.
The retrace is healthy and we are looking for support to provide confirmation so it can go the next leg upwards.
If you look at the various options market, you would also see that huge volume are forming at the $220 mark.
The contract expiring 2nd July 2021 has over 24k in volume while the contract expiring 9th July 2021 has also garnered the most volume to date.
Personally, I have added 200 shares last night for Baba at around $222, which now brings my total Baba shares to 500 at an average price of around $225.
I think that’s an appropriate amount of both allocation and decent average price to ride it up to the next leg.
If you have not bought a position into Baba but has always been interested in their business, now may be the right time for you to look at it.