BULLISH PRICE RSI + MACD DIVERGENCE ON BABAAfter weeks of bashing, this stock seems to be finally moving towards its bottom. There are various indicators that points that BABA has bottomed out.
1. RSI - PRICE DIVERGENCE on Daily chart. Both RSI & MACD have improved while the price has been on a Downward trajectory.
2. PUT CALL Ratio changing its complexion from completely bearish to less bearish on Monthly options.
3. The stock is sitting at 61% Fib retracement.
4. Inverted hammer on weekly candle (though this is a red candle but still it can be looked as a reversal candle if next candle breaks the high of previous week)
5. 30 & 60 Min RSIs bouncing off from low 20s again and again.
6. Too many CPR gaps to be filled in the range of 155 - 167
If this gap up in next trading session. Just go long blindly.
BABA trade ideas
Sunday Prep 8/22 - $BABAReally impressive how far this has come in. Typically I keep china names off the Sunday Prep, but I think this is becoming quite the opportunity. We have now retraced to the 61.8% fib level
Will be watching for capitulation down into that quarterly pivot area of 144-145. It may gap up in which case I will possibly look to get long and risk Friday’s lows.
Move upbaba is likely to move up to 254-257. This is just a short term bounce till the time 234 is holding . Buying can be done at 240-241 with sl below 234 . Those holding postion at higher levels can look to exit around 255-265 . I do not seee it crossing again 285 levels in meidum term. From there I expect 190-177 levels.
Demand supply zone241-265 should be the supply zone where big 🐋 s might offload who had accumulated in previous buying zone. They didn't expect regulatory action. Will try to avoid getting stuck in a wrong trade because of uncertainty. 188-178 will be the demand zone where actual institutional investors may emerge.
ALIBABA to BUY on the OPENI will take the opening to get LONG on ALIBABA stock.
2 scenarios:
a- MARKET open and price go straight to R2 pivot level at 200
b- A retest around 192 ish level to target R2 pivot level at 200
Obvisously scenario 3 with invalidation at 187 level (which is ok and included in the risk management).
Happy trading