Current trend

Shares of Alibaba Group Holdings Ltd., one of the largest companies in the field of e-commerce, are correcting at 92.00.

Large Chinese companies remain under pressure in anticipation of a significant increase in tensions in trade with the United States after the victory of the Republican representative, Donald Trump, in the American presidential election. The politician’s election program includes a Chinese import tariff increase to 60.0% to stimulate domestic production, which could not compete in the market against cheaper imports. The main negative point is the wait-and-see attitude of market participants who are in no hurry to invest in Chinese companies until the plans of the head of the White House are implemented.

On its website, Alibaba Group Holdings Ltd. announced its intention to settle a class action lawsuit from investors in the US, which claims that it occupies a monopolistic position in the market. The management decided to shorten the process, which could cause unplanned expenses, and offered the Manhattan federal court a settlement agreement with a payment of 433.5M dollars. According to experts, in this case, the corporation’s losses will be minimal since the estimated penalties after all charges are confirmed exceed 11.63B dollars.

Support and resistance

The trading instrument is correcting, forming a global Expanding formation with boundaries of 120.00–78.00.

Technical indicators are strengthening the sell signal: the EMA oscillation range on the Alligator indicator is expanding, and the AO histogram is forming downward bars in the sell zone.

Resistance levels: 95.20, 105.80.

Support levels: 89.20, 77.40.

Trading tips

Short positions may be opened after the price declines and consolidates below 89.20, with the target at 77.40 and stop loss 92.00. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 95.20, with the target at 105.80. Stop loss is above the current price of 92.00.