Alibaba Group (US: BABA) on our report dated 1st September, we were positive that wave 5 would go beyond US$300.00 and terminate near US$305.67. However, prices reverse sharply near 200.00% extension level and rebounded at US$268.00 according to our strategy plan B. Based on the wave analysis, we believe that Alibaba will have further correction to the downside near support zone 1:
*The technical call is valid for 3 weeks only.
*Should the support zone 1 be invalidated, the next possible support region will be at US$212.68-US$218.58. Forming a stronger downside impulsive wave.
CHART LEGENDS
Moving average
Red dotted line = 200-day moving average
Blue dotted line = 50-day moving average