A Wall Street Veteran Has His Eye On This Stock
A Wall Street Veteran Has His Eye On This Stock
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Good Morning,
This morning we are watching shares of Alibaba BABA 0.00%↑ for a potential ‘next leg up’ as it currently trades at around $120.
BABA is currently down around -1% on the year to date but, that could potentially change soon and that is what we are watching for.
Editors Note: We did feature BABA on “The Golden Ticket Trade” for a Buy signal of around $107 for our exclusive readers. Some of our readers are sitting up over 12% on the position.
Guys, our more advanced set of traders has been aware of BABA and its developing chart for weeks now. Make sure to take advantage of our 20% off for life offer which expires soon. This way you can get access to the inside.
The Big Picture Of BABA
Looking at the weekly chart you can see:
It was trading in a 1-year and 7-month downtrend
It did break out above that trend a few weeks ago (which our exclusive traders were made aware of)
The bad news is we also can see that:
Volume is decreasing on this breakout
I Am Going To Tell You EXACTLY What We Want To See Happen On BABA
As traders, we search for conviction! High Conviction attracts demand and buyers with large position size which creates more…VOLUME!
The fact that BABA is breaking out on decreasing weekly volume is of great concern.
BUT…
We DO NOT want to take the volume into a large influence on our thesis due to the fact that the low volume could be because of a “lack of sellers”.
If the volume is because of a lack of supply then all BABA would need is an event to bring in demand.
That Event May Be Near…
Looking at the daily chart we can see that it is nearing a potential breakout above the 200-day simple moving average (200SMA).
It is also trading on a very strong trendline as it has tested this trendline and confirmed it as support numerous times (a break below the trendline would be of concern to bulls).
Taking A Closer Look
As you can see on the chart below:
It pulled back around 24%
Then recently pulled back around 8%
This shows us CONTRACTION in volatility!
This is big because it could be evidence of a potential lack of supply!
Now, it is trading around a KEY resistance level this morning but, if it does breakout above the 200SMA then it will be of interest to traders around Wall Street.
Editors Note: We did feature BABA on “The Golden Ticket Trade” for a Buy signal of around $107 for our exclusive readers. Some of our readers are sitting up over 12% on the position.
See⬇️
The Bottom Line
The bottom line is this company is a great company but, with certain regulations and ongoing geopolitical tensions it could be of higher risk to own.
Traders and Investors are watching this for a move over the 200-day simple moving average.
In fact, most investors do not even buy a stock unless it is above the 200-day simple moving average!
As we ALWAYS tell our more exclusive readers and traders, KEEP IT SIMPLE! Do not try and overcomplicate things.
Lastly, take advantage of our limited-time 20% off for life offer.
We have been giving exclusive commentary on the SPY 0.00%↑ as it trades in a BEAR FLAG! DO NOT MISS WHAT WE HAVE TO SAY NEXT.
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