Did you see the price action on Alibaba Group Holding Ltd (NYSE:BABA) today? The stock opened sharply higher before seeing about 1 hour of hard, heavy selling. This took the stock from a big gain to negative. After the first hour, Alibaba has slowly floated higher back to the flat line and slightly positive on extremely light volume.
So what does this mean? Why is it so significant? The heavy volume selling which last an hour was major institutions unloading. They always sell into strength and have to do it early in the morning because that is the only time there is enough volume and can get out of a stock without crashing it. In addition, the gentle float since on light volume confirms that the small investors are buying it still and institutions are now at lunch.
- Published: 29 September 2016
- Written by verifiedInvesting