Alibaba (BABA) shares closed at $152.28 last Wednesday, dropping to $135.59 yesterday, marking the lowest level for 2026.
The roughly 10% decline stems from several bearish factors:
→ Resignation of Lin Junyang (Justin Lin) – Lin, head of Alibaba’s Qwen AI project, a major LLM platform, unexpectedly stepped down. According to Reuters, this is the third high-profile departure from Qwen in 2026, with no explanation given by Lin.
→ Pressure on the tech sector – The broader technology sector has been under pressure due to high capital expenditure and uncertainty over returns. Alibaba has pledged at least CNY 380 billion (approximately $52 billion) in AI and cloud infrastructure over three years, raising concerns about short-term profitability.
→ US regulatory scrutiny – Media reports indicated that Alibaba was added to a list of companies linked to China’s military, potentially complicating operations. Although the listing was later removed from the US Federal Register, the attempt highlights the ongoing risk of sanctions.
→ Geopolitical instability – Rising tensions in the Middle East and the possibility of an expanded conflict have increased demand for safe-haven assets, placing additional pressure on Chinese tech stocks.
Despite these headwinds, technical analysis suggests potential opportunities for bulls.
Technical Overview of Alibaba (BABA) Shares
The latest candlestick shows a close well above the low of the session, with trading volume spiking to the highest levels since late January. This indicates that buying interest is supporting the price and preventing a deeper decline.
Historical patterns provide further context. In late August, BABA shares broke a descending trendline, and on strong volume, began a rally toward multi-month highs.
This precedent suggests that bulls may regain confidence near the $130 level, potentially stabilising the stock and limiting further losses.
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