BABA is on the verge of reversal. It is on the last sub-wave of weekly corrective B wave and ready to make a huge run upside on C wave. My strategy is to buy at 59.6, stop loss 56.7. Very small stop loss, small risk high reward trade set up.

Short to medium term, I wouldn't suggest being long a Chinese company right now considering the PBoC has no choice but to massively devalue the Yuan. BABA shares dropped the last time the PBoC devalued.

There's a litany of reasons not to be long BABA over the long term.... most of which boil down to the Chinese can't be trusted, and Jack Ma is your prototypical thieving Chinese businessman (i.e. the Chinese can't be trusted).

I admit Chinese government may devalue their currency again. But that is still up in the air, no one know when or how much they would. The fact is that BABA is doing good, at least on their sheets, from cash flow to earnings. That the fundamental side of it. The reason I propose this trade is because it has huge upside and small risk. This set up don't show up everyday on the market. If it breaks 57 level, you set a stop limit sell, and turn back to sell at that level. You will make back the loss in no time. Also, for long term buying, you buy a stock, does not mean you are going to hold it for months or years. The technical will help you to decide when to get out if it breaks a certain level. It also help to know when to take your profit. Also, it is better to divide your entry and exit order to multiple lots. I will update the details when trade is active.

If you are not a Chinese citizen then you can't actually own BABA. What you would actually own is some derivative of Alibaba with a Cayman Islands address. This BABA derivative doesn't even own Alibaba's version of PayPal. You should read the actual document of the deviative you would be buying. It basically says Jack Ma may choose to buy you out at whatever price he decides to pay you. Unless of course the parent (BABA) fails and then you get to keep it forever and ever! Good luck!

This is why I avoid all foreign ADR stocks. In addition to being derivative to the underlying asset, currency changes add another layer of valuation complexity.

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It basically says Jack Ma may choose to buy you out at whatever price he decides to pay you.

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That's assuming he decides to pay you! Investors in the ADR have zero recourse if Alibaba were to stop paying dividends to the Cayman BABA entity.

Trade Active. Buy order hit at 59.6. Price has bounced up nicely to 62 . Stop loss still set at below 57.

Target 1 is 65. target 2 is 69

Price is at 62.x now. Move stop loss to entry point. Target is still at 65.2

For a minute there I was worried that a "reversal" of BABA would mean a come back of ABBA.

Take half profit at 65.2. Trailing $1 for the other half to target 2.

Nice trade!

Thank you. My profit 2 was hit since last week at 67.x when I set trailing $1. I should have waited until today to take it at 69. Anyways, it was a nice trade. Trade closed.

Still trucking along.

Up 10% today.