Price Marks a Loss Of 10% In 20 Days

BABA stock price had a good start in 2023 as the price showed a rise of 33% in January, forming an annual high at $121.30. Alibaba drew a lot of investors’ attention during the start of the year. The bullish momentum was ignited by the actions of the Beijing government.

Regulators of China took steps to open up its economy, thereby walking away from their long standing zero-covid policy. All of the major Chinese stocks saw a rise during the start of 2023.

The stock price melted to $80 after the bullish rally of January in order to establish support. Alibaba gained bullish momentum in order to retest the annual high but the move was discontinued at $103.50 and the price fell once again. BABA stock price recently formed support at $78 and started its bullish journey to rise above $100, which was due to the positive earning results reported by the company. However, the price could not rise above $94.

Currently the stock price is headed toward the $78 support level. The previous candle closed as a bearish candle. If bears can push the price below $83, there is a high probability for the price to head toward $78. On the other hand, if the price could break above $88, there is a possibility of a retest of the $94 resistance level.

Expansion In Alibaba Holdings

Freshippo, the grocery unit of Alibaba, has expanded its physical stores in China. Freshippo is also headed toward IPO but Alibaba has not provided any timeline.

Revenue has also increased by 2% to $30.32 billion in the first three months of 2023. The quarter 1 earning results of alibaba are to be released on 17 august 2023. The consensus estimates revenue to be $30.61 billion and earnings per share (EPS) to be $1.943. The previous two quarters were profitable for Alibaba and the Chinese government is taking steps to strengthen the economy.

Will BABA Stock Price Rise Above $100 This Month?

BABA stock price trades below the 20,50,100 and 200-day EMAs, indicating bearish momentum in the price. The previous candle has also rejected the 20-day EMA. Chaikin Money flow score is -0.22, suggesting weakness in the market.

The relative strength index trades at 45.58, denoting that price is in neutral territory and is facing equal pressure from bulls and bears. The stock price will soon reach the lower band of bollinger if it crosses below $83 which implies that there is a possibility of short-term pullback.

Conclusion

The market structure and price action of Alibaba is bearish after the price faced rejection from $94. The technical parameters suggest that bearish momentum is strong and there is a possibility for the price to head down toward $78. Bulls need to enter the market to protect the price.

Technical Levels

Major support: $74 and $74.70

Major resistance: $94 and $103.50

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing