Fundamentals leading to sudden rise of baba
Prologue
From February 2021 to the present, the general decline of Chinese concept stocks has been very large, and the adjustment cycle has reached about one and a half years. It can be said that the adjustment of Chinese concept stocks has been relatively sufficient. When the irrational selling sentiment in the market is excessively released, if there are some positive signals near the historical bottom area, it will easily attract the attention of some bottom-hunting funds and cause the price to rise.
What is the observation?
The strong upward trend of many Chinese concept stocks is obviously related to factors such as the improvement of market investment sentiment and the accelerated entry of bottom-hunting funds. However, is the upward trend of Chinese stocks a rebound or a reversal?
Why is there a reversal?
For a stock price to reverse, at least two conditions must be met. One is a fundamental reversal or a reversal of the policy environment, that is, an essential reversal of the pessimistic fundamentals and policy expectations of the market in the past two years; the other is The reversal of the technical and financial aspects, that is, the room for the stock price to rebound from the low point by more than 20%, and there is a large capital to accelerate the entry, can the price reversal trend be realized.
Is it a long term trend ?
Although the Chinese concept stocks are showing signs of gradually coming out of the bottom, it seems a little early to talk about a reversal. However, we are still beginning to see some positive signals, such as the policy environment has begun to improve, some well-known institutional investors have begun to accelerate their entry, and the earnings data of some Chinese concept stocks have improved.
Summarise
Aside from the influence factors of the policy environment and the capital environment, with the irrational decline of stock prices in the past two years, under the current valuation status, China Concept Shares should have room for a sharp rebound. Obviously, the excessive release of pessimism in the market in the early stage also led to the very pessimistic valuation and pricing of China concept stocks. As long as the policy environment and fundamentals begin to stabilize, there is a high probability that China concept stocks will usher in an opportunity for valuation repair.
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- Moolele·2022-05-28Time for reversal already? 😋2Report
- familoveyou·2022-05-28BABA is a good company with good performance.And its price is low enough.4Report
- Jenjorjack·2022-05-2980-100 range bound for now the global outlook is not supportive for a bull market as well.3Report
- JakeL·2022-05-29No doubt. It’s a long term investment.4Report
- XantheJuliana·2022-05-28I think the most important factors is BABA had dropped too much.3Report
- SalTheFun·2022-05-28Now….right time?1Report
- Seanthh·2022-05-29fundamentals rock3Report
- Michelle Ong·2022-05-28Like back thanks2Report
- MortimerDodd·2022-05-29At present, Chinese ADRs is still in the rebound stage.2Report
- ToughCoyote·2022-05-28Look forward to you comments1Report
- BurnellStella·2022-05-29Whether they're out of the bottom or not, at least the prices are good.2Report
- HilaryWilde·2022-05-29The requisite out of the bottom is a double click by Davis.2Report
- DonnaMay·2022-05-29Your analysis coincides with mine.2Report
- YorkTurner·2022-05-28Which do you prefer short-swing or long?2Report
- MR_Wu·2022-05-29These stocks need more policy support.1Report
- GerryLoh·2022-05-29good sharing thanks1Report
- ToughCoyote·2022-05-28What do you guys think aboit this style ?1Report
- Ken7979·2022-05-30its long overdue..LikeReport
- Zhaoxiang·2022-05-29like plsLikeReport
- JCWOO·2022-06-01okLikeReport