Alibaba (9988.hk): New High with Less Convincing Technical Indicators
George Lam October 22, 2020 1:12 PM
Alibaba Group (9988.hk) has reached a new high on Wednesday, however some technical indicators are less convincing...
China Securities Regulatory Commission has approved Alibaba Group's (9988.hk) Ant Group IPO in Shanghai, as the company seeks to raise 35 billion dollars in a dual listing in China and Hong Kong.
On the other hand, Fitch Ratings has affirmed Alibaba Group's "A+" credit rating, outlook "Stable". The rating agency said "the affirmation underscores Alibaba's very strong business profile, large economies of scale, strengths in digital economy, increased revenue diversity, continued robust profitability, high free cash flow generation and conservative capital structure".
From a technical point of view, Alibaba Group (9988.hk) remains trading within a bullish channel drawn from May as shown on the daily chart. However, it has reached a new high on Wednesday with a less convincing candlestick again, while the relative strength index continues to show bearish divergence. Therefore, investors might have to remain cautious as consolidation might be due before the next rally. The level at $280 might be considered as the nearest support, while the 1st and 2nd resistance are expected to be located at $305 and $326 respectively.
Source: Gain Capital, TradingView
From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.
As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.