This is my very first publication on Trading View! $BIDUBIDU had a great run up past few weeks, very consistent and in-line with the direction of the market. However, I didn't personally consider it an out performer until it broke 285 resistance. Speaking from technical point BIDU broke a major resistance and pulled back into its original upward trend which started since Dec. However, today it failed to break through upper band of the channel and Fibonacci retracement. Meaning most likely we will see some pull back back and consolidation tomorrow.
Also there is new uptick in volume, which translates to bulls starting to take profit today from their prior longs and indicates considerable sell off. Hence the stock is very unlikely to make new highs tomorrow. Sell off may have been completed today or continue tomorrow depending on market condition. However under right market condition it will take few days for buyers to create an upward momentum in BIDU again.
However, as long as the market keeps up with making new highs, and doesn't change trend I expect BIDU to follow suit. If we see a pull back tomorrow, I think it is a great buying opportunity at $285-295 level with suggested stop of $10-$15. However I would have firm breakeven stop or close my position before going through earning report which is coming up next week.
My Personal advise: The market is overwhelmingly overbought and the news of stimulus and economical recovery and vaccine availability is already priced into the stock market. The main driver of the market right now is simply lack of investment opportunity in other asset classes, low interest and unprecedented cash injection by the government. All which puts the market in a bullish state with very fragile foundations. What all this translate to? At this time minimize your risk and stick to your stop orders because once this market start to break down it will do rather very aggressively and Government can only prop up the market to certain extend. Hence when the music stops you do not want to be the one hold the bag!
This is my very first analysis please let me know what you think?
I hold put options in BIDU, this is not a financial advise!
Best,
Ali