Loading...
by Darius Anucauskas

Can Baidu Inc Stock Keep Investors Interested?

Looking at the short-term technical picture of Baidu Inc stock (NASDAQ: BIDU), it seems to be forming an ascending triangle, which is clearly visible on the 4-hour chart. According to TA textbooks, such patterns tend to break to the upside. But as history has shown, it doesn’t always work out that way. From around mid-August, the price continues to form higher lows, but is still struggling to move above its key resistance, at 113.25. If, eventually, that barrier fails to withstand the bull-pressure and allows BIDU to climb above it, this is when we will start examining slightly higher areas. But until then, we will take a cautiously-bullish approach.

As mentioned above, if we see a clear push through the 113.25 barrier, marked near the highs of July 31st, August 20th and September 11th, this might attract more buyers into the game, as this would mean that the ascending triangle has been broken. This is when we will target the 116.75 hurdle, which marks the highs of July 10th and 24th. If that hurdle is just seen as a temporary obstacle on the way of the bulls, the next potential target could become the 200 EMA, or the 120.90 level, marked near the highs of June 20th and July 1st.

Our oscillators, the RSI and the MACD, are giving us mixed signals. The RSI, after topping in the first half of September, moved slightly lower. That said, the indicator is still above 50 and points slightly to the upside. The MACD continues to run above zero, but recently shifted a bit below its trigger line. It seems that neither of our short-term momentum studies clearly support any of the directions, enhancing our choice to stay a bit cautious.

On the other hand, if the aforementioned upside line breaks and the share price falls below the 106.90 zone, marked by the inside swing high of August 29th, such a move could interest more sellers to join in. The stock might then drift to the 102.00 hurdle, a break of which could clear the path for further declines. BIDU may then slide all the way to the 97.40 level, marked by the high of August 16th.

Baidu 4hour

Disclaimer:

The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.

There are risks involved with trading of cash equities. Past performance is not indicative of future results. You should consider whether you can tolerate such losses before trading. Please read the full Risk Disclosure.

Copyright 2019 JFD Group Ltd.

 

WEEKLY FINANCIAL NEWSLETTER
RIGHT INTO YOUR MAILBOX!
SUBSCRIBE TO JFD'S STRATEGIC REPORT