This stock should always be regarded as a ‘buy’ on weakness. It’s hard to imagine what could be ailing BABA, unless it’s the predations of dirtballs who manipulate the stock price hither and thither for ethically dubious gains. Assuming they’re pushing it lower now in order to shake loose some shares at fire-sale prices, we can look to bottom-fish at the 103.09 midpoint Hidden Pivot shown. Specifically, I’ll advise a 103.12 bid for 400 shares, stop 103.04. If you’d prefer to use options, do your buying based on the target provided for the stock, but you can loosen up a little bit on the stop-loss, as long as you don’t risk more than a dime ($10) or so per option. The stop is necessary because if it’s hit, more weakness down to 99.54 is likely to follow. _______ UPDATE (December 28, 6:22 p.m. EST): The sideways shuffle of the last two sessions has generated a new place to try very tightly stopped bottom-fishing: 103.66. If this Hidden Pivot support gets schmeissed, the next logical opportunity would come at 100.11, based on the pattern shown. _______ UPDATE (December 29, 9:57 p.m.): Yesterday’s pathetic hump altered our corrective targets slightly to, respectively, 104.15 and 100.59.
Belated news note: An article in the Wall Street Journal on Tuesday detailed the failure of TMall Global, an Alibaba shopping platform, to attract foreign brands as it was designed to do. This is obviously a setback for the company, but no moreso than the doubts that plagued Facebook along the way. Recall that Zuckerberg didn’t even have a business model for extracting advertising revenues from personal devices when they began to take off — a shortcoming for which investors punished Facebook shares, at least for a brief while. And so it shall be with Alibaba. However, their vast reach bodes well for the company’s eventual success, and although they may stumble along the way, their good fortune down the road should not be considered in doubt.