Stock of the Day: Alibaba Group
29 December 2025
Alibaba has been undergoing a bearish correction since October, but the structure of this move is important. The decline is not impulsive; instead, it is shaped like a falling wedge, marked with blue trendlines. A falling wedge is a classical correction pattern, especially when it appears after a broader upswing, and it often hints at a potential bullish resolution rather than a trend reversal.
What really matters here is support. The price is bouncing from a green horizontal support around $147, which previously acted as a local top in March. Former resistance turning into support is a technically strong behavior, and the fact that buyers stepped in at this level increases the probability that this correction is maturing rather than accelerating.
From a trading perspective, the setup is very clear. A daily close above the upper line of the falling wedge would confirm the end of the correction and trigger a proper long-term buy signal. That would signal renewed bullish momentum. On the other hand, if the price breaks below both the lower wedge boundary and the $147 horizontal support, that would invalidate the bullish thesis and generate a sell signal, opening the door for a deeper decline. For now, Alibaba remains in a decision zone, with buyers defending an important level and waiting for confirmation.