BABA 81.27 – neutral – Bases near key resistance area
BABA rallied strongly from its 57.20 YTD low (September 29, 2015), following the 12-month downtrend breakout (on October 23, 2015), to reach a new 3-month high at 85.79 Tuesday (October 27, 2015), near 38.2% of the 120.00/57.20 fall and the 200 day moving average currently at 81.05, before basing. The indicators are overbought, cautioning for pullbacks. The 78.25 low (October 27, 2015 low) serves as the immediate support. A deeper pullback below the latter would risk 72.84 (October 23, 2015 low, near 38.2% of the 57.20/82.79 rise) where buyers should step in. However, a push through 82.79 would accelerate the upleg towards 85.38 (July 24, 2015 lower high) ahead of 88.57 (50% of the 120.00/57.20 fall).
Outlook:
Daily: neutral near term due to overbought condition
Weekly: neutral
BABA rallied strongly from its 57.20 YTD low (September 29, 2015), following the 12-month downtrend breakout (on October 23, 2015), to reach a new 3-month high at 85.79 Tuesday (October 27, 2015), near 38.2% of the 120.00/57.20 fall and the 200 day moving average currently at 81.05, before basing. The indicators are overbought, cautioning for pullbacks. The 78.25 low (October 27, 2015 low) serves as the immediate support. A deeper pullback below the latter would risk 72.84 (October 23, 2015 low, near 38.2% of the 57.20/82.79 rise) where buyers should step in. However, a push through 82.79 would accelerate the upleg towards 85.38 (July 24, 2015 lower high) ahead of 88.57 (50% of the 120.00/57.20 fall).
Outlook:
Daily: neutral near term due to overbought condition
Weekly: neutral