What Led Alibaba Group (NYSE: BABA) Stock to Hit 52 Week Low

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Alibaba Group Holding Ltd (NYSE: BABA) stock has had a rough time lately. In June, Alibaba Group Holding Ltd (NYSE: BABA) shares hit an all-time high of 208 USD, since then the stock has fallen drastically, today trading at 155 USD per share. Throughout 2017 Alibaba Group Holding Ltd (NYSE: BABA) climbed, making a name for itself as a new giant in the stock market, growth seemingly exponential. 

So, what changed for the company, fundamentally? Nothing really. Alibaba Group Holding Ltd (NYSE: BABA) is still growing it's revenues and increasing its cash flow. What has changed, however, is investor sentiment. Based in China it's only natural trade tensions would bring the stock down. 

What Caused Alibaba Group Holdings Ltd Stock 52 Week Low?

Investors are worried fresh tariffs may put further pressure on the companies Alibaba Group Holding Ltd (NYSE: BABA) caters to in e-commerce. Additionally, the ill-timed departure of CEO and co-founder, Jack Ma, turned some holders into sellers. Most see Alibaba Group Holding Ltd (NYSE: BABA) as a business ambassador, of sorts, between the U.S. and China, tense relations and uncertainty have driven the stock into a downtrend.

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There has also been skepticism expressed over their increased revenue numbers. Some analysts point out that the huge increase in revenue could be due to the devaluation of Chinese currency recently and thusly are manipulated numbers. Other analysts write that concern off and point out that revenue has been steadily growing over the companies history, and have exploded because there is a demand for their service like never before. 

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On a technical level, it seems like sell-offs may continue for some time,  with 120 USD being the next strong support if 250 breaks as 170 USD did before it. Looking at the books there isn't anything wrong with Alibaba Group Holding Ltd (NYSE: BABA) other than some unfavorable climates. This hasn't stopped traders from taking advantage of the narrative to short the stock and create more artificial selling pressure. Value investors are searching for a bottom, seeing a long-term play, it's difficult to say where that could be so the smartest move could be either to slowly scale in, or watch and wait for a new uptrend to be established in the price action before making a move. 


Comments (3)

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  • Jesse
  • ,  Contributor
  • 12 September 2018, 12:09 pm

I like BABA long term and think this is a great entry point.

   0   Reply (0)   Follow(437)  

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    • John R
    • ,  Contributor
    • 12 September 2018, 09:09 am

    If it doesn\'t go over 160 and close above today then the trend is still down unfortunately.\n

       0   Reply (0)   Follow(437)  

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      3 years 600, 6 years 1200; who sees this in charts?

         0   Reply (0)   Follow(437)  

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