What to expect from Chinese Tech Giants Alibaba and Tencent?
Alibaba Group (9988.hk): Consolidate Before Next Rally
From a technical point of view, Alibaba Group remains trading within a bullish channel drawn from May as shown on the daily chart. However, it might have formed a bearish shooting star candlestick on Wednesday, while there are signs of a bearish RSI divergence, suggesting there might be a pull-back in the shorter-term. The level at $271 might be considered as the nearest support, and if this level holds, prices are still likely to test the 1st and 2nd resistance at $305 and $320 respectively.
Tencent (700.hk): Early Signs of an Upside Breakout
On a daily chart, Tencent appears to have gathered more upside momentum as it just broken above a 3-month bullish consolidation range, following a rally in the second quarter. The level at $528 might be considered as the nearest support, while the 1st and 2nd resistance are expected to be located at $584 and $630 respectively.