Alibaba Group Holding Limited (NYSE:BABA) Stock Hitting on All Cylinders

Alibaba Group Holding Limited (NYSE:BABA) Stock Hitting on All Cylinders

Alibaba Group Holding Limited (NYSE:BABA) Stock Hitting on All Cylinders

No American company, not Amazon (NASDAQ:AMZN), not Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) nor even Facebook (NASDAQ:FB), has the kind of results Alibaba shows routinely.

Despite increasing its inventory risk, building its company-owned supply chain and opening retail malls, 57% of every yuan that came in Alibaba’s door last year hit the gross profit line. Alibaba has enough cash to pay off its long-term debts with a check, despite its enormous, and growing physical presence across the world’s fastest-growing economies.

As the U.S. walks away from the world, Alibaba runs toward it, setting up direct supply agreements for Argentine beef and Chilean fruit, and entering a strategic partnership with Mexico.

The American relationship with China matters very little to Alibaba. We’re only a source of capital, and if we don’t invest, other people will. Alibaba is now China’s most valuable brand.

While the “996” culture — working from 9 am to 9 pm six days every week — sounds monstrous, it speaks to workers’ absolute faith in the company. It’s also just three hours longer than what my dad worked in his TV repair shop 50 years ago. (He closed Saturdays at 6 p.m.)

Anything Amazon can do, Alibaba can do better. Its Tmall makes Whole Foods look like a gas station convenience store. Amazon has a 30% growth rate, but Alibaba has a 60% growth rate. There are many investors who still short Alibaba. A lot of people are losing money.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 197.04.

The projected lower bound is: 179.89.

The projected closing price is: 188.47.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.

A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 4 falling windows in the last 50 candles–this makes the current falling window even more bearish.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 67.4321. This is not an overbought or oversold reading. The last signal was a sell 15 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 53.70. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 42 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 4. This is not a topping or bottoming area. The last signal was a sell 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 2 period(s) ago.

Rex Takasugi – TD Profile

ALIBABA GRP ADR closed down -6.970 at 188.240. Volume was 73% above average (neutral) and Bollinger Bands were 57% narrower than normal.

Open High Low Close Volume___
185.880 189.000 185.390 188.240 5,130,817

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 188.36 183.61 165.49
Volatility: 32 30 43
Volume: 2,816,576 2,772,896 3,979,107

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

ALIBABA GRP ADR gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
ALIBABA GRP ADR is currently 13.7% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of BABA.N at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on BABA.N and have had this outlook for the last 11 periods.

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