This update is 100% due to the fact that I saw the chart of SINA and thought it interesting. I am probably the least knowledgeable person on the planet when it comes to Chinese internet stocks. Your own knowledge and/or research must play into this. On to the chart…
The daily chart shows a huge pullback to the 62% Fib retrace area, which also filled a gap, hit the SMA 50 and touched the top of the 80 to 84 support area. It is possible SINA could stop going down right here.
The weekly shows a giant Cup, with a higher right side than left side (something I like to see). The harsh drop could be part of a Handle to be made and this could be a long-term grind with jagged (i.e. volatile) ups and downs to come over several months. Or it could be a flash downside reaction to be followed by an upside one.
However, this Cup comes well below the 2011 bubble high and so, is it really a Cup? Regardless, the recent downside has created a drop to or toward a support area in a stock that has been in a relentless uptrend for 2+ years.
For those who may have interest in either the long-term ‘China story’ or the short-term ‘casino play’ aspect of this stock…
- A stingy buyer may try to get below 80, while a true believer big picture macro buyer could try for the 80-84 range.
- A really stingy buyer could see if it hits the SMA 200 and the green dotted line, currently around 76.
- For a stop, I would not let it get below 74 on a daily close.
- The implied target – for a buy at 80, for example – is around 100.
A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the buy, sell, stop parameters are already noted. They are meant as a starting point for further research if interested. I will not personally buy every item highlighted and will sometimes sell – without prior notice (because this takes time and resource away from NFTRH’s main functions) – any item that I do buy, below target, which is something I often do as a trader. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.