Is BABA due for a pullback

Alibaba Group (BABA) is not currently experiencing a pullback. Here's an analysis to support this conclusion:

1. Technical Indicators Suggest Otherwise: Alibaba's stock (BABA) is not showing signs of a pullback based on recent technical indicators. The MACD (Moving Average Convergence Divergence) is at -2.35, and the KDJ (Stochastic oscillator) is at -4.91, which typically suggest bearish trends. However, the RSI (Relative Strength Index) is at 27.07, indicating that the stock may be oversold and could potentially rally in the short term.

BABA Trend

2. Stock Price Movement: The closing price of BABA on November 15, 2024, was $88.38. The stock has shown resilience with a pre-market increase of 3% on November 15, 2024, following the release of earnings that beat expectations in terms of profit but missed on revenue. This movement contradicts the expectation of a pullback.

BABA Trend

3. Market Sentiment and Analysts' Outlook: Despite the challenges, including missing revenue estimates and facing stiff competition, there is an optimistic outlook from analysts. J.P. Morgan projects a 6% year-over-year increase in Alibaba's quarterly revenue, and forecasts suggest an upward movement for Alibaba's stock. This sentiment is further supported by the average price target of $101.38, which is higher than the current trading price, indicating potential upside.

4. Fundamental Analysis: Alibaba's reported solid growth in international and cloud divisions, which is helping to offset the drag from its anemic Chinese commerce business. The company's international division expanded revenue by 35%, and the cloud unit accelerated revenue growth to over 7%. This diversification into international markets and strong performance in cloud services could be indicative of a company that is not experiencing a pullback.
5. Market Performance: Alibaba's stock outperformed the S&P 500 on November 14, 2024, closing at $95.42, a 1.31% increase from the prior day. This performance is contrary to the expectation of a pullback.

In conclusion, Alibaba Group (BABA) is not currently experiencing a pullback. The stock's technical indicators, recent price movement, analyst sentiment, and fundamental performance all suggest a different outlook.