Hong Kong stocks are rallying, driven by growing excitement around AI and big investments in Chinese tech. DeepSeek AI has sparked optimism, boosting major stocks like Alibaba. At the same time, billionaire investor David Tepper’s hedge fund, Appaloosa LP, has increased its stake in Alibaba, showing confidence in its future. With AI hype and institutional buying, Alibaba is a key winner in this market surge.
Since I posted this article on $BABA-W(09988)$ , the stock has surged by 25%.
In this article, I will share more analysis on Alibaba since the stock has moved up significantly in less than one month.
Will also be reviewing the performance of its DLC (daily leverage certificate).
Analysis of Alibaba
Support and Resistance:
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Support Level: Immediate support is near to 100.0 level, which is a round number.
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Resistance Level: The immediate resistance is around 118.0, which has historically been a significant level.
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Volume: There has been an expansion in trading volume, indicating increased investor interest and potential continuation of the upward trend.
Potential Target Level:
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If the price breaks above the 118.0 resistance level, the next potential target could be calculated based on the recent price movement and historical patterns.
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Calculation:
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Breakout Level: 118.0
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Recent Range: The recent range is from 70.0 to 118.0, which is a 48-point range.
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Potential Target: Adding the range to the breakout level gives a target of 166.0 (118.0 + 48.0).
What if you had traded a DLCs when Alibaba was at 85 (when I posted)…
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DLC Cumulative Return: +164.36%
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Alibaba Stock Cumulative Return: +24.41%
Reason for Higher DLC ( $Alibaba 5xLongSG251113(DKPW.SI)$ ) Returns:
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Leverage Effect:
DLC is a leveraged product, designed to amplify daily price movements of the underlying asset (Alibaba stock).
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Amplified Gains: For example, a 5x leveraged product aims to provide five times the daily return of the underlying asset.
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Compounding Effect: Daily resetting of leverage can compound returns over time, especially in a trending market.
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Positive Market Trend: Consistent upward movement of Alibaba stock during the observed period contributed to the amplified gains.
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Risk Consideration: While leveraged products can magnify gains, they can also amplify losses if the underlying asset moves in the opposite direction.
Going forward, these are the DLCs of Alibaba
Short DLCs $Alibaba 5xShortSG260513(56QW.SI)$
Long DLCs $Alibaba 5xLongSG250924(9O5W.SI)$ $Alibaba 5xLongSG250904(DISW.SI)$
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For more information about DLCs, visit https://dlc.socgen.com/en/education/handbook
Disclaimer:
This document is not an offer or solicitation to buy or sell, nor financial advice or recommendation for any investment product. This document has been published for general circulation only.
This advertisement has not been reviewed by the Monetary Authority of Singapore. This post is sponsored by Societe Generale, Singapore Branch. The content of this article does not form part of any offer or invitation to buy or sell any daily leverage certificates (the “DLCs”), and nothing herein should be considered as financial advice or recommendation. The price may rise and fall in value rapidly and holders may lose all of their investment. Any past performance is not indicative of future performance. Investments in DLCs carry significant risks, please see dlc.socgen.com for further information and relevant risks. The DLCs are for specified investment products (SIP) qualified investors only.
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