Alibaba Shares Jump 3.9% to $119.45 as Bullish Signals Mount for Third Straight Gain

Alibaba Group (BABA) shares rose 3.90% on the most recent trading session (June 4, 2025), closing at $119.45. This marks the third consecutive day of gains, resulting in a 4.93% increase over this period.
Candlestick Theory
Recent price action for Alibaba Group shows a significant bullish engulfing candle formed on June 4th, where the price opened near $116.66 (the session low) and closed near $120 (the session high), decisively engulfing the prior day's small real body. This pattern, occurring after a minor pullback, signals strong buying pressure. Key resistance is evident around $120-$121, established by the May 28th high and the recent June 4th intraday peak. Support has formed near $114.75-$115, aligning with the June 2nd low and close, defended successfully during the May 30th sell-off. A breach above $120 would target resistance near the May highs around $126. Conversely, failure to hold $115 may see a retest of stronger support near $110-$111.
Moving Average Theory
The short-term 50-day moving average (MA) is currently trending sideways around $112-$113, while the long-term 100-day and 200-day MAs exhibit a slight upward slope near $108 and $101 respectively. The current price ($119.45) sits above the 50-day MA, suggesting potential short-term bullish momentum. However, it remains below the psychologically significant $120 level. A sustained move above the 50-day MA would be encouraging, but the lack of clear separation above it and the distance above the longer-term averages indicate a nascent recovery phase rather than a strong established uptrend. The longer-term trend structure remains neutral to cautiously positive given the upward-sloping 100/200-day MAs.
MACD & KDJ Indicators
The MACD histogram has recently crossed above its signal line, generating a fresh bullish crossover signal, although it remains below the zero line, suggesting emerging positive momentum is still developing from a bearish territory. The KDJ indicator shows the K-line crossing above the D-line from oversold territory (below 30) around June 2nd. Both K and D lines are now rising sharply towards the 50 level, reinforcing the short-term bullish momentum identified by the MACD crossover. There are currently no strong divergence signals warning of an immediate reversal. The indicators collectively suggest improving, albeit still developing, upward momentum.
Bollinger Bands
Price has broken above the middle band (20-day SMA) with the June 4th surge, approaching the upper Bollinger Band near $120.5-$121. This breakout follows a period of band contraction in late May/early June, indicative of reduced volatility preceding the recent directional move. The expansion that started with the June 4th thrust suggests an increase in volatility favoring the upside in the near term. The close proximity to the upper band means further immediate upside might be limited, potentially leading to consolidation or a minor pullback unless the bands continue to expand aggressively. A sustained move above the middle band ($116-$117) supports the bullish short-term bias.
Volume-Price Relationship
Volume on the significant breakout day (June 4th) was elevated at ~17.98 million shares, the highest in recent weeks, providing validation for the bullish price move. This contrasts favorably with the lower volume experienced during the minor pullback days on May 29th and June 2nd-3rd. However, the volume spike on June 4th was less pronounced than the surge seen during the sharp decline on May 15th. This suggests conviction in the breakout is present but hasn't yet reached peak capitulation levels. The volume profile overall offers moderate confirmation supporting the sustainability of the current advance.
Relative Strength Index (RSI)
Calculated using the standard 14-day period, the RSI is currently reading approximately 56. This places it firmly in neutral territory, rising from near oversold levels (below 40) in late May. It is comfortably away from the overbought threshold (70), indicating there is room for further price appreciation before the rally becomes technically stretched based on this indicator alone. The RSI's trajectory aligns positively with the recent price gains, showing no bearish divergence at this juncture.
Fibonacci Retracement
Applying Fibonacci retracement to the downward swing from the recent significant peak near $147.57 (March 17th) to the trough near $98.61 (February 3rd) establishes key retracement levels. The price is currently challenging the 50% retracement level ($123.09). The recent rally stalled near the 38.2% level ($119.77-$120) on multiple occasions (late May peaks, June 4th intraday high). A decisive close above this $119.77-$120 zone opens the path towards the significant 50% retracement ($123.09) and then the 61.8% level ($127.55). The $123 level represents a crucial confluence resistance point with prior price structure.
Confluence and Key Levels
A significant confluence of resistance exists around the $120-$123 zone. This area combines: 1) The 38.2% Fibonacci retracement ($119.77), 2) The psychological $120 level, 3) The recent June 4th intraday high ($120) and key May swing highs, 4) The upper Bollinger Band proximity ($120.5-$121). Sustained trading above $123.09 (50% Fib) would be a strongly bullish technical development. Conversely, support converges near $114.75-$115 (recent lows & close) and more critically near the long-term moving averages and the $110-$111 area (key swing low in late April/mid-May). The technical picture improved notably with the high-volume breakout above the 50-day MA and $119.77 Fib level. Confirmation above $120 with continued bullish momentum indicators (MACD, KDJ) suggests potential for a test of $123 in the near term, though overextension near the upper Bollinger Band warrants monitoring for consolidation. Downside risks emerge on a break below $115, potentially signaling the recent advance was corrective.