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Fan Yang

Baidu (BIDU) Completes a Small Price Bottom; Upside will be Challenged Around $180

Baidu $BIDU has been in a bearish correction mode since May when it peaked around $284. Price has since fallen to a recent low around $154. At the turn of the year (2018-2019), we saw price action form a mini-double-bottom on the daily chart.

BIDU Daily Chart

(click to enlarge)

Resistance Pattern:
- As price approaches $180, starting around $177, BIDU will start to face resistance factors.
- There is a falling trendline resistance.
- There is also the bottom/support of the November '18 consolidation.
- Note that since August, when price dipped below a consolidation pattern, it has come back up and treated the support of that previous consolidation as resistance. 
- If price finds resistance in the $177-$180 area, we would be seeing the same pattern of resistance, which would indicate continuation of the bearish correction possibly towards the $150 area. 
My Trade:
- For now, I would limit the bearish outlook to the 2016-low just above $140. 
- I personally have a position half the size I would have during a bull market. I got in at $180 and $160 (averaged in $170).
- I would like to now prepare some significant position size for $145, based on my respect for the $140.50 support. 
- If triggered, I would have a full size position around 2.5% of my portfolio. 

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