BABA Follow Up

Monday 11/10 we covered BABA in Alibaba (BABA) saying that BABA was very strong, but a pullback was expected near term, yesterday a follow up post was put out, BABA Follow Up as BABA had its 2nd biggest day down,  at -3.87%, it certainly looked like our near term pullback thesis had started.

I had posted in yesterday's BABA Follow Up ,

"I used a 30 bar moving average on a 60 min chart to define the trend and a break of that moving average should lead to a deeper pullback. I'd suspect somewhere around the 50-bar 60 min chart (blue) moving average which is around $110."

And yesterday's support...

 Right at the 60 min 30-bar moving average, but also...

Chennai

Right at the top of the Channel on the Channel Buster move. It's going to be very hard for BABA to resist the failed breakout of a Buster's downside momentum usually taking it to the lower channel or below the lower channel before having the ability to right itself.

This plays right in to our hands as I had also posted yesterday,

"After a break of the Trend Channel there can be some sideways volatility, for any counter trend short trade I'd like to see some volatile lateral chop as it would give us a clear picture as to whether BABA is worth a counter trend short swing trade."

So really, so far, so good for several potential trades.

This morning here's what BABA is looking like.

 Officially the Trend Channel has not been broken yet on a closing basis. However as I previously said, it will be hard for BABA to resist the gravitational pull of a Channel Buster, a concept that has worked over and over again.

 This the inrtraday 1 min chart, note the negative in to Monday's close and the Tuesday gap down with a positive divegrence in to this morning that is just starting to turn down.

 The 2 min chart is a carbon copy of the divergences on the 1 min chart.

If the 1 and 2 min current divergences keep up, we should see BABA range in a consolidation which will be excellent for determining whether a swing trade short (on a pullback) is a safe trade.

 The pullback itself looks pretty probable, not only the Channel Buster, but charts like this 3 min that are leading negative at the Channel Buster highs or...

Larger 10 min chart trends like this.

Lets hope we get a couple of good trades, maybe a swing short followed by a pullback long...