Alibaba Group Holdings, Ltd. (BABA) Price Forecast: Buyers Eye Post-Breakout Pullback

Post-Breakout Pullback Tests Support

The first pullback following a bull flag breakout in the stock of Alibaba Group Holdings, Ltd. (BABA) may be in an area likely to attract buyers. Last week’s pullback to a low of $152.85 completed a 78.6% Fibonacci retracement at $152.94 of the small advance that followed the flag breakout. This week’s low of $153.46 confirmed support. If BABA confirms support with a move up, a higher swing low will be established and bullish momentum from the breakout should reassert itself. Short-term caution is warranted, as Alibaba Group is scheduled to report fiscal Q3 2026 earnings on February 19.

Channel Structure Supports the Trend

Alibaba Group stock is in a bullish position within a rising trend channel. The prior pullback that followed a new trend high of $192.67 in October, bounced from support zone near the trend high from March 2025 at $148.43 and the 50% retracement of the near-term upswing at $148.19. The subsequent flag breakout on January 12 rose above a four-day high and reclaimed the 20-week moving average. Although the 20-week average is not currently being recognized by the market, the higher swing low in January showed strong support that is expected to hold unless the channel structure is violated.

Long-Term Structure and Key Resistance

BABA triggered a long-term bottom reversal in February 2025 above $117.82. The reversal was

confirmed in August after the first pullback to support at the 50-week average completed. This indicates that the long-term advance as represented by the trend channel, shows dynamic support at the 50-week average. Note that the 50-week average converged with the lower trendline of the channel, starting from the July swing low. The first advance from the flag breakout found resistance at $181.10, which resulted in a lower swing high. It is also interesting to note that resistance corresponded with the center line of the rising channel and followed resistance at the October peak, which was very close to the top of the channel. This sequence suggests that resistance is developing along the upper half of the channel.

Downside Levels to Monitor

If this week’s low fails to hold as support, the next potential downside support zone is near $145.27, with the rising trendline providing an additional guide. However, the more significant support zone remains near the 50-week average, now at $140.47.