BABA runs into sellers again around 216.43
Alibaba Group Holding Limited (BABA) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
BABA ended the month 4.01% higher at 215.70 after gaining $0.68 (0.32%) today on low volume, notably underperforming the S&P 500 (1.54%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (BABA as at Jun 30, 2020):
Tuesday's trading range has been $3.53 (1.64%), that's below the last trading month's daily average range of $4.72. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly lower than usual for BABA.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, three candlestick patterns are matching today's price action, the Southern Doji and the Takuri Line which are both known as bullish patterns and one neutral pattern, the Doji.
After having been unable to move above 216.50 in the previous session, Alibaba Group ran into sellers again around the same price level today, missing to move higher than 216.43. The last time this happened on June 24th, BABA lost -1.79% on the following trading day.
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could accelerate should prices move below the nearby swing low at 211.82 where further sell stops might get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Takuri Line" stand out. Its common bullish interpretation has been confirmed for Alibaba Group. Out of 30 times, BABA closed higher 63.33% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 63.33% with an average market move of 1.47%.