To The Moon

Alibaba ( $BABA-W(09988)$ , $Alibaba(BABA)$ ) is expected to show strength in its cloud and e-commerce units for the December quarter, with Nomura projecting 10% cloud revenue growth and 4% growth for Taobao and Tmall. Customer management revenue is forecast to rise 6%, improving from 2.5% in the September quarter. Nomura maintains a buy rating with a US$130 target price for its ADRs. 

Alibaba’s earnings report is scheduled for January 29, 2025. 

This analysis explores the technical aspects of Alibaba chart and highlights key levels. 

Technical Analysis of Alibaba (9988.HK)

Trend Analysis

Since early 2024, Alibaba has been in an uptrend, forming higher highs and higher lows. The rising trendline (green) reflects strong buyer support, indicating sustained bullish momentum.

Bullish Divergence

The MACD shows bullish divergence, with higher lows in the indicator despite stable or lower lows in price. This signals weakening bearish pressure and suggests potential for continued upward movement.

Key Resistance Levels

Alibaba's price faces significant resistance at three prominent levels:

1. 90 HKD: This psychological level currently acts as immediate resistance. A breakout above 90 could invite further bullish momentum.

2. 100 HKD: This is the next major resistance zone. A break above 100 would likely confirm medium-term strength in the stock.

3. 115 HKD: As the highest resistance level shown, a rally to this point would mark a significant recovery for Alibaba, requiring substantial buying pressure.

These levels are critical for traders as they mark zones where price movement may slow, reverse, or gather momentum depending on market sentiment and volume.

Using DLCs for Short-Term Trading on Alibaba

DLCs (Daily Leverage Certificates) can be a powerful tool for traders looking to capitalize on short-term price movements in Alibaba.

Using DLCs to Trade Alibaba

Trading Alibaba with Long DLCs

• Scenario: If a trader expects Alibaba's price to rise (e.g., breaking above resistance at 90 HKD), they can buy a Long DLC (e.g. $Alibaba 5xLongSG251113(DKPW.SI)$ ).

• Example: With 5x leverage, a 2% rise in Alibaba’s price could result in a 10% return on the DLC.

Trading Alibaba with Short DLCs

• Scenario: If a trader anticipates Alibaba’s price to fall (e.g., rejecting resistance or breaking below support), they can buy a Short DLC. (e.g. $Alibaba 5xShortSG260513(56QW.SI)$ )

• Example: A 2% drop in Alibaba’s price could lead to a 10% gain in a 5x Short DLC.

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Disclaimer: 

This document is not an offer or solicitation to buy or sell, nor financial advice or recommendation for any investment product. This document has been published for general circulation only. 

This advertisement has not been reviewed by the Monetary Authority of Singapore. This post is sponsored by Societe Generale, Singapore Branch. The content of this article does not form part of any offer or invitation to buy or sell any daily leverage certificates (the “DLCs”), and nothing herein should be considered as financial advice or recommendation. The price may rise and fall in value rapidly and holders may lose all of their investment. Any past performance is not indicative of future performance. Investments in DLCs carry significant risks, please see dlc.socgen.com for further information and relevant risks. The DLCs are for specified investment products (SIP) qualified investors only.