(Bloomberg) -- Alibaba Group Holding Ltd.'s post-earnings slump has invalidated a bullish breakout, leaving its January lows vulnerable.
Another 1.4% drop in Hong Kong on Friday pushed its share price to below the right shoulder low of a head-and-shoulders formation, which had witnessed a confirmation given the upside move earlier in the week.
Technicals now suggest a downside price target of HK$59, which implies a 15% drop from Friday's close.
READ: Alibaba Falls as Weak Core Business Offsets Buyback: Street Wrap
For options set to expire on Feb. 28, the highest put open interest under current prices stands at a strike of HK$67.5, followed by $62.5.
Traders will look at these levels to lend support should prices get there, with the HK$72.5-HK$75 zone expected to serve as an upside barrier to any near-term recovery.
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