Stock of the day: Alibaba

By Tomasz Wisniewski|

Published: February 07 2024, 01:33 GMT+0

Stock of the day: Alibaba

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In today’s analysis, we delve into the recent developments surrounding Alibaba’s stock, which has showcased a promising start to February. The chart reveals an unfolding inverse head and shoulders pattern, a classic indication of a potential bullish reversal. This pattern is characterized by its distinctive structure, marked in green, which has caught the attention of many traders looking for signs of a turnaround.

Central to this formation is the neckline, delineated by a black line. A breach of this neckline, as we have recently witnessed, typically serves as a catalyst for bullish momentum, signaling a buy opportunity. Alibaba’s stock has not only surpassed this crucial threshold but is also on the verge of overcoming another significant barrier.

The mid-term downtrend, represented by a red line, is currently under assault from the bulls. This development further bolsters the bullish case, indicating a potential shift in the stock’s trajectory. However, it’s the resistance at the $79 mark, highlighted by a yellow line, that remains the final bastion for bears. This horizontal resistance is the last obstacle preventing a fully realized buy signal.

For now, the situation remains tentatively positive, with the stock hovering just below this critical juncture. A decisive close above the $79 threshold would not only confirm the bullish reversal but also set the stage for a more extended rally. Such a move would solidify the buy signal for Alibaba, transitioning from a theoretical opportunity to a robust long-term investment prospect.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-alibaba-5

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