trdollar
Long

BABA Reversal from recent lows, looking for 90.00

NYSE:BABA   ALIBABA GROUP HLDG LTD
Inverse head and shoulders pattern on 30 minute chart with high volume . consolidation between 85.00-86.20. A move with consistent volume can take BABA to 90 quickly.
Point of Caution:
1) 8% move happened in one day. Time is needed for consolidation. Profit taking should occur with support from buyers.
2) P/E above 40 on a business that has a market cap of $213B+
3) 2.23B float. Every $1 increase means BABA is worth $2.23B more, i.e., valuation can really get ahead of itself quickly.
4) Investigations in to allegedly erroneous transactions could prove harmful in the short term.
chartmojo PRO
2 years ago
keep in mind 429 million shares unlocking on the 18th...thats' huge overhang
+1 Reply
trdollar chartmojo
2 years ago
Valid point. It was priced so high in its IPO range, I'm sure there are tons of millionaires who want to dump shares. BUT, I think they'd rather dump them around 90.00 than 80.00. I wonder if any of the banks that organized the IPO will buy the stock up to 90.00 and let the 400M+ shares enter the market there. The big question is if BABA is really worth $213B or more.
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mihai.mititelu trdollar
2 years ago
Do you think BABA can make a new record low before March 18th? Thanks.
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chartmojo PRO mihai.mititelu
2 years ago
I think the way to think about it is...there is selling pressure coming, been coming for a long time...in another 6 months 1..6 billion additional share will be come available...one cant predeict the future...but for me I look for weakness and op's to short...if it pops and goes up..great ..more for me to hit on the downturn with a tight stop...
+1 Reply
chartmojo PRO trdollar
2 years ago
we will see...reality it 429 mil shares is SUPER GIGANTIC overhang....I mean I cant emphasize that enough in words
+1 Reply
trdollar chartmojo
2 years ago
The 18th has come and gone...stock seems stable. Seems like the sell off from low 100's to 80's represented the expected overhang of ~430M shares. I like it in the low 80's for the long run.
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chartmojo PRO trdollar
2 years ago
Yup....
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chartmojo PRO chartmojo
2 years ago
hope it rises for a few months...then I'll short it the months into the 1.6 bil share lockup exp.
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chartmojo PRO chartmojo
2 years ago
if you think 3-6 months out on baba and look for the cycles one can make some serious $
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