Alibaba’s IPO last autumn was treated like the Second Coming, but some may be wondering at this point what all the fuss was about. The stock fell to an all-time low yesterday, down 33% from a $120 peak achieved in November, and about 11% beneath the low of its opening-day range. How much further might the stock fall? It breached a major Hidden Pivot support yesterday, but the intraday low caught the midpoint pivot of another, lesser ABC pattern (see inset). It was a high-odds spot to try bottom-fishing, although a limit bid at or near the pivot would have missed the actual low by 59 cents. While I can’t predict how far the bounce will go, it’s safe to say that a decisive breach of the 79.44 support would send BABA down to 69.57, the ‘D’ target shown. _______ UPDATE (March 5, 11:41 p.m.): The bounce has legs. Yesterday’s rally out-of-the-hole looked bound for a minimum 86.85, a midpoint resistance, but any higher would indicate 89.68. _______ UPDATE (March 9, 4:48 a.m.): The rally died well shy of 86.85, but the larger, presumably corrective, uptrend remains intact, at least for now.
