Fari Hamzei says that shares of Alibaba Holding Group Ltd BABA are consolidating at the current level.
He’s the founder of Hamzei Analytics, and he recently joined Benzinga’s #PreMarket Prep to explain why he’s anticipating a move in Alibaba’s stock in the near future.
Hamzei explained that there is a lot of daily data on Alibaba, but it’s so suppressed because of the way that it has traded in such a short range in the last 20 to 25 days.
The stock had a decent range and direction all the way up to the middle of November, Hamzei said.
“Since then, it kind of shut down slowly, and if you come into about December 1, it’s been a very tight range,” he said.
Hamzei doesn’t use any weekly data for Alibaba yet, but he said the daily data shows a slight downward movement momentum-wise. He thinks by the company’s second earnings report, there will be more weekly data.
What Hamzei worries about is the tight daily range.
“So what happens when volatility drops like that? It coils up. It’s ready to explode again,” Hamzei said. “Somewhere in here is going to be some sort of event where the stock is going to react; which way it’s going to go, I don’t know.”
Hamzei also talked about Twitter Inc TWTR, Tesoro Corporation TSO and crude oil.
Check out his full interview here:
Don’t forget to tune in to Benzinga’s #PreMarket Prep broadcast Monday-Friday 8-9:45 a.m. ET for a live, interactive morning show with veteran traders and featured finance industry experts ready to answer your questions for the trading day.
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