Alibaba Group Holding Ltd (NYSE: BABA) is surging higher Thursday after Beijing diplomat Yang Jiechi described his meeting with U.S. National Security Advisor Jake Sullivan as constructive.
Even after the move today, Alibaba is still in a significant downtrend, Ritholtz Wealth Management CEO Josh Brown said Thursday on CNBC’s “Fast Money Halftime Report.”
The stock has rallied multiple times over the last year but still managed to maintain its downward trajectory, Brown said.
“Even with today’s gain, BABA is in a 50% drawdown from its high,” Brown said, “which was Oct. 20. So in the last 12 months, count up all of the 10% rallies like the one we are seeing today. Not one of those led to increased highs.”
See also: Alibaba Breaches Near-Term Resistance: How High Could The Stock Go?
For those who are considering putting money to work in Alibaba stock, it should be “very, very, very short-term trading,” he emphasized.
Until there are signs of a real bottom, Alibaba and other Chinese stocks should be avoided, Brown said, adding that it’s too early to say that this is the bottom.
BABA Price Action: Alibaba has traded as high as $319.32 and as low as $138.43 over a 52-week period.
The stock is up 8.88% at $156.91 at time of publication.
Photo: hinglish Notes from Flickr.
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