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Elliott Wave View: Alibaba Has Started the Next Leg Lower

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Short term Elliott Wave view in Alibaba (BABA) shows an incomplete sequence from May 4, 2019 peak. The decline from there can either unfold as a zigzag or impulsive Elliott Wave structure. We use the impulsive structure as the chart below shows that the rally to $183.44 ended wave ((2)). This means, Alibaba is now within wave ((3)) lower. In Elliott Wave Theory, wave ((3)) is typically the strongest and longest wave inimpulse structure.

Wave ((3)) is currently in progress as an impulse Elliott Wave structure where the stock is ending wave (1) of ((3)). Down from $183.44, wave 1 ended at $173.32, wave 2 ended at $180.24, wave 3 ended at $160.02, and wave 4 ended at $164.50. Another leg lower should end wave 5 of (1). The stock should then bounce in wave (2) to correct cycle from May 15, 2019 high before the decline resumes. We dont like buying the stock and expect any rally to fail in 3, 7, or 11 swing for further downside as far as bounce stays below $183.44. A conservative target where the 3 swing from May 4, 2019 peak reaches equality comes at $149.7 $156.2.

Alibaba (BABA) 1 Hour Elliott Wave Chart

BABA May 21

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About the author  (by EME PROCESSING AND CONSULTING LLC) was founded in 2005 by Eric Morera. Since inception our company has provided tailored Financial Market Services to thousands of clients.

ElliottWave-Forecast has built a reputation on accurate technical analysis and a winning attitude. By successfully incorporating the Elliott Wave Theory with Market Correlation, cycles, proprietary pivot system, we provide precise forecasts with up-to-date analysis for 42 instruments including FX majors, Gold, Silver, Copper, Oil, TNX and major Equity Indices. Our clients also have immediate access to our proprietary actionable trade setups, market overview, 1 Hour, 4 Hour, Daily & weekly wave counts. Weekend webinar, Live Screen Sharing Sessions, Daily Technical Videos, Educational Resources, and 24 Hour chat room where they are provided live updates and given answers to their questions.

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