BABA
BABA case study: Resolution of 200 days correctionToday we want to share our conclusions about the resolution of huge corrective patterns on BABA. One of the key aspects of Technical Analysis is to take advantage of anomalies in historical data; in other words, take advantage of situations that present some degree of repetitiveness to create a probabilistic scenario in our favor, where risking our money is worth.
In this case, we observe that after 200 days of correction, there is a specific sequence for bullish continuation movements.
1) Breakout of the structure
2) Clear Throwback (retest of broken structure) another characteristic is that the correction is very steep
3) The breakout of that correction represents a great opportunity in terms of risk-reward ratio if we set our stop loss below that pattern
Past behavior is no guarantee of future behavior, and bla bla bla.... That's absolutely true; however, if you are not in favor of the Efficient Market Hypothesis, you can see that there are subtle patterns in price data that we can take advantage of, not by saying, "This or that will happen, but by trying to get exposure to a specific pattern several times (taking the same trade 10 times), that way we can start observing an edge.
So, final conclusion in this case study: Now, we will comfortably sit in our chairs, and we will not do anything until the filter we have defined happens. If that's the case, we know exactly how we will trade. If the filter does not happen, guest what... We don't trade; there are more than 2000 stocks that you can wait for a BEAUTIFUL and PREMIUM scenario.
Thanks for reading!
A butterfly flapping its wings can cause a hurricane in China!You don't need to see an Optometrist, and you did not drink an excessive amount of alcohol, at least I did not, however, I am not sure about you..!
There is nothing wrong with you if you see BABA , PDD , JD , NASDAQ:BIDU creates the exact same pattern..!
This could be explained in mathematics!
What is Chaos Theory?
Chaos is the science of surprises, of the nonlinear and the unpredictable. It teaches us to expect the unexpected. While most traditional science deals with supposedly predictable phenomena like gravity, electricity, or chemical reactions, Chaos Theory deals with nonlinear things that are effectively impossible to predict or control, like turbulence, weather, the stock market , our brain states, and so on. These phenomena are often described by fractal mathematics, which captures the infinite complexity of nature. Many natural objects exhibit fractal properties, including landscapes, clouds, trees, organs, rivers etc, and many of the systems in which we live exhibit complex, chaotic behavior. Recognizing the chaotic, fractal nature of our world can give us new insight, power, and wisdom. For example, by understanding the complex, chaotic dynamics of the atmosphere, a balloon pilot can “steer” a balloon to a desired location. By understanding that our ecosystems, our social systems, and our economic systems are interconnected, we can hope to avoid actions which may end up being detrimental to our long-term well-being.
Chaos Theory
Chaos theory is concerned with unpredictable courses of events. The irregular and unpredictable time evolution of many nonlinear and complex linear systems has been named chaos. Chaos is best illustrated by Lorentz’s famous butterfly effect: the notion that a butterfly stirring the air in Hong Kong today can transform storm systems in New York next month. The definition of deterministic chaos implies that our prediction in the form of a model, for instance, is very sensitive to the initial conditions. The difference between predictions with slightly different initial conditions grows exponentially:
d(t)=d(0)eat*
where d(t) is the difference between the two predictions at time t and d(0) at time zero, t is the time, and a is a positive number.
*at: is the power of e, I do not know how to type power in TradingView..!
Chaos theory, more technically nonlinear dynamical systems (NLDS) theory, is an exciting, rapidly developing area of mathematics with increasing application in the physical, biological, and social sciences. Along with the great metaphorical appeal, nonlinear dynamical systems can also add rigor and realism to human sciences; they may help illuminate creativity, an elusive, sometimes near-magical phenomenon that has defied simple explanations. Chaotic or near-chaotic systems can demonstrate surprising flexibility and adaptability. Despite connotations of ‘chaos,’ they also demonstrate order, complexity, and self-organization. Some relatively simple, mechanistic, completely deterministic systems are capable of surprising, discontinuous, and seemingly unpredictable change.
Challenged by Instability and Complexity
Challenged by Instability and Complexity…
Jan C. Schmidt, in Philosophy of Complex Systems, 2011
1 Introduction: the Stability Assumption Is Unstable …
Nonlinear Dynamics — including Complex Systems Theory, Chaos Theory, Synergetics, Dissipative Structures, Fractal Geometry, and Catastrophe Theory — is a young and fascinating field of scientific inquiry that spans many established disciplines (cf. ). However, it poses challenging problems for both scientific methodology and the philosophy of science. Methodological prerequisites as well as metaphysical assumptions are questioned, e.g., predictability, reproducibility, testability, explainability as well as lawlikeness (determinism/causation). The common denominator of all of these challenges is instability — that is the main thesis of this paper.
Since the advent of Nonlinear Dynamics and its advancement in the realm of physics in the 1960s — interlaced with methodological developments in computer technology and the computer's ability to numerically handle nonlinearity — further evidence for the existence and prevalence of unstable and complex phenomena in the physical world has emerged. Nonlinear systems, even those with just a few degrees of freedom, can exhibit static, dynamical and structural instabilities. Although instabilities call implicit metaphysical-methodological convictions and well-established underlying prerequisites of mathematical science into question, today they are not viewed in just a negative way. On the contrary, instabilities are highly valued — we find a positivization of instabilities: instabilities constitute the nomological nucleus of self-organization, pattern formation, growth processes, phase transitions and, also, the arrow of time (cf. ). Without instability, there is no complexity and no change. The phenomena generated by underlying instabilities in nature, technology and society are manifest; we can observe these phenomena with our unaided senses. In fact, instability is the root of many homely phenomena in our day-to-day experience — for example, the onset of dripping from a tap or water freezing to ice in a refrigerator. Instability has to be regarded as an empirical fact of our life-world and beyond — not just as a contingent convention.
A reconsideration of the traditional methodological-metaphysical stability assumptions therefore seems to be indispensable. (a) In the past, stability was taken for granted as an implicit a priori condition to qualify a mathematical model as physically relevant or adequate. Stability seemed to be a key element underlying any kind of physical methodology: it was regarded as the sole possibility to guarantee the application of methods of approximation and, also, to deal with empirical and experimental uncertainties. (b) In addition to methodology, an underlying metaphysical conviction was pervasive throughout the history of physics, guiding the focus of interest and selecting the objects that were considered worth researching. Framing and conceptualizing nature as “nature” insofar as it is stable, time-invariant and symmetrical (metaphysics), was indeed a successful strategy to advance a specific physical knowledge (methodology). It is interesting to see that metaphysical convictions and methodological considerations are interlaced; there is no clear line between metaphysics and methodology, as will be shown in this paper.
Throughout history, stability metaphysics has always played a major role in science, beginning in ancient times with Plato's stability concept of the cosmos. In modern times, stability metaphysics can be found in the works of outstanding physicists such as Newton and Einstein. For instance, in his Opticks Newton did not trust his own nonlinear equations for three- and n-body systems which can potentially exhibit unstable solutions . He required God's frequent supernatural intervention in order to stabilize the solar system. In the same vein, Einstein introduced ad hoc — without any empirical evidence or physical justification — the cosmological constant in the framework of General Relativity in order to guarantee a static and stable cosmos, “Einstein's cosmos” . Both examples, from Newton and Einstein, illustrate that metaphysical convictions — what nature is! — can be incredibly strong, even if they are in conflict with what is known about nature at the time.
Today, however, ex post and thanks to the advancement of Nonlinear Dynamics, we can identify a “dogma of stability” that has determined the selection (or construction) of both the objects and the models/theories in physics. “We shall question the conventional wisdom that stability is an essential property for models of physical systems. The logic which supports the stability dogma is faulty.” : the stability assumption is itself unstable! Although the discovery history of instabilities traces back to physicists such as Newton, Laplace, Stokes, Maxwell, Poincaré and Duhem, physical objects were (and often still are) perceived and framed from the perspective of stability — even by the pioneers of instabilities. Throughout the history of exact sciences, instabilities were not acknowledged by the scientific community. This has been changing since the 1960s when physics began widening its methodological horizon — including getting rid of the restriction of methodology to stability requirements. The need to advance physical methodology emerged because instabilities have turned out to be so very fundamental in nature, technology, and even in social processes. In order to deal with instabilities, physicists have over the last 30 years successfully replaced the traditional quantitative, metrically oriented stability dogma by weaker, more qualitative topological characteristics. Many models (theories, laws) in Nonlinear Dynamics are unstable, “and we are confident that these are realistic models of corresponding physical systems” .
Nonlinear Dynamics shows that instability is not an epiphenomenon of minor relevance: instabilities are broadly present in our entire world. Discovering and acknowledging instabilities impels both a reconsideration of the metaphysical views that undergird the stability dogma and a revision of the methodological presuppositions. The outline of this paper is as follows: In section 2, I characterize instabilities and distinguish between three kinds of instability. In section 3, I focus on methodological problems and challenges caused by instabilities; the limitations of classical-modern sciences will be discussed. In section 4, I show how present-day physics manages, at least to some degree, to cope with instabilities.
Instabilities cannot be considered as exceptions within a stable world. Rather, it is the other way around: instabilities are the source of complexity, pattern formation and self-organization. This is why instabilities do not only appear in a negative light; a positive understanding emerges and shows challenging future prospects and perspectives for the rapidly progressing field of Nonlinear Dynamics — and beyond: for all mathematical sciences.
My Soul is painted like the wings of a butterfly..!
Moshkelgosha
References :
www.sciencedirect.com
fractalfoundation.org
$BABA at levels of high value.
Alibaba Group Holding Limited (BABA) , also known as Alibaba Group and Alibaba.com, is a Chinese multinational technology company specializing in e-commerce, retail, Internet, and technology.
It is currently at prices from 2017-2018 and pre-Covid. It has retraced about 45% from its record high which puts it in a deep bear market. Current Fair Value , according to DCF, is $301.
The Technicals show the following:
1) Bollinger Bands show that it is overextended to the downside by 3 standard deviations.
2) The Volume Profile , which measures volume by PRICE , shows that since its IPO, this price level here is where the most VOLUME comes in. This can be translated to, these levels here is were investors find value in the stock.
3) The RSI on the Daily show that it is grossly oversold.
Buying China Stocks here will require mental strength as bad news continues to circulate the Media. This can be compared to the Covid Crash of 2020 where the market took a tumble and the media made retail feel as if the market had no bottom. At the levels that most retail sold was actually the levels to buy. Famous words by the great Warren Buffett when he says "Be fearful when others are greedy, and greedy when others are fearful." Chinese stocks have been in a bear market for over 8 months while companies like Alibaba continue to bring in Billions of dollars in revenue.
We must learn that a stock price does not always reflect the value of a company; it is our job as investors to look for and find that value in the market. For now, it seems as if the long term value is here in Alibaba.
ALIBABA - Saw support at $180-Shares of Chinese e-commerce giant Alibaba Group Holding (NYSE:BABA) dropped 4% as of 10 a.m. EDT Monday, and given the headlines coming out of China last week regarding how the government is cracking down on tech companies left and right, this is not too surprising.
-As The Wall Street Journal reported over the weekend, the Chinese government is pressing tech giants Tencent Holdings (OTC:TCEHY) and Alibaba affiliate company Ant Group to help it develop a new "state-backed digital currency" -- i.e., a cryptocurrency -- to be dubbed the e-CNY (or electronic Chinese yuan).
-This is bad news for Alibaba because Ant operates the Alipay digital payments network already, and the emergence of a competing e-CNY brings "the risk of eroding the huge user base" that Alibaba and its affiliates have built up over the past decade.
-All of these negative effects dropped the price of BABA greatly. Now that we had enormous amount of drop in this stock, time is to buy it from the dips. This entry ofcourse is suggested for long-term investors rather than the short ones as the state of Chinese stocks and Baba is still under some pressure.
WISH ContextLogic Buy RumorsI know this rumor isn`t new, but makes us think a little bit about WISH`s valuation.
One person close to WISH`s Insiders said Amazon offered $10 billion all-cash to buy the company, and Wish's CEO didn`t agree.
Looking at today`s Market Cap of only 6.438Bil, i would say that from a valuation point of view you can buy it cheaper than Bezos now.
My short term Price target considering also the Avg. Volume of 59Mil per day is the 15usd resistance.
I look forward to read your opinions about it.
BABA longterm (weekly)BABA in weekly is currently forming a falling wedge. We would potentially be ready for a wave 1 after that downtrend, 200 area acted as a support recently, if it can hold again we could potentially start wave 1. I would like to see MACD turning bullish with RSI back over neutral level first. BABA earnings is August 19th, a good report can be the catalyst for the falling wedge break and the comeback of China's giant. Yellow lines are longterm level to watch :)
On july 8th BABA dropped below 200 mental number but we saw a dip buy. Daily candle closed with a wick down and more volume than usual, its good sign.
Opinion : BABA is currently undervalued and could see a massive run after that downtrend break. Keep it on the shopping list !
BABA 3D Buying with a short stop can give a good resultLooking at the global chart of Alibaba Group shares, it appears that the 38% corrective fall is reaching its logical conclusion.
During the fall, each renewal of the minimum was accompanied by a decrease in trading volumes, and the "Bullish Pennant" pattern is formed on the chart itself.
The target for working out such a pattern is in the region of $265-285, which is at least + 30%.
In this zone, you should cover longs and look around to see what the general mood will be in the market.
Analyzing the chart today, we consider the scenario of the continuation of the correction of the price of BABA shares down to $165 , and possibly to $135, after a rebound to the zone of $265-285 from current prices , is more likely.
This assumption will be shattered by buyers if they can confidently fix the price of BABA shares above $285
Let's wait and see who will dominate the market in the future)
$BABA $NOW $CVNA $GLD I OptionsSwing WatchlistBABA 1D I Testing the $205 area for the third time, could be seeing a triple bottom before the breakout from this falling wedge.
NOW 1D I We could be seeing a possible inverse H&S, Watching above the $567 level for continuation and possible retest of $600 before its ER.
GLD 1D I After breaking out from a bull flag back, we are seeing GLD retrace back and possibly making a double bottom near $165.
CVNA 1D I Showed strength last week and it is testing ATH levels. Watching a break above $325 with volume to see it continue run up into earnings.
Has Alibaba found a Bottom? So far no. Alibaba (BABA) has been in a free fall down 36% since October 26th, 2020 when rumors began circulating that he had gone missing or had been arrested by the Communist Chinese Regime (CCP) that same month. Another factor that helped led to the sell off was rumors that Alibaba might be delisted form the NYSE. On Thursday (BABA) fell below $200 which had been a key support, but quickly recovered Friday to $205. At this $200 mark I believe Alibaba has been able to find a support and can start making a move to the up side. Currently is has a strong resistance at $230 which once broken and turn into a massive up run. There are three main factors that led me to believe a major upturn is upon us with BABA. 1. The RSI had hit 30 (1d Chart) when it broke $200. It then quickly bounced off. So with a really low RSI we have a ton of run to run. 2. TTM Squeeze Consolidation. I have been using the TTM indicator for a while now and have found when the indicator starts to consolidate and major run to either side happens and we are currently seeing this consolidation happen. 3. Alibaba is in a descending triangle which means a breakout can happen to either side, this helps support reason 2 and can help fuel a break sooner rather than later. Once I see a Break I will be buying calls. Let me Know what you think.