Last Wednesday, the closing price of Alibaba (BABA) shares was $152.28, while the closing price yesterday was $135.59, marking a 2026 low.

The roughly 10% decline was driven by a combination of bearish factors, including:

→ Unexpected resignation of Lin Junyang (Justin Lin) – Lin led Alibaba’s AI project Qwen, a key LLM platform. According to Reuters, this is the third notable departure from Qwen in 2026, and Lin has not provided a reason.

→ Overall bearish trend in tech stocks – High capital expenditures combined with uncertainty over profitability have weighed on the sector. Alibaba previously committed at least CNY 380 billion (around $52 billion) for AI and cloud infrastructure investments over three years.

→ Pressure from US regulators – Reports indicate that Alibaba was added to a list of companies cooperating with China’s military, potentially complicating business. Although the listing was later removed from the US Federal Register, the attempt itself increases the risk of new sanctions from the administration.

→ Geopolitical tensions – With the threat of the Middle East conflict escalating into a wider war, financial markets see increased demand for safe-haven assets. Chinese tech companies are particularly exposed to these pressures.

Despite these challenges, technical analysis offers hope for the bulls.

Technical Analysis of Alibaba (BABA) Shares

Take a look at the most recent BABA candlestick – the closing price is well above the low, while trading volume has surged to the highest level since late January. This can be interpreted as a sign of demand preventing further price declines.

Looking at history confirms this observation. In late August, BABA shares broke through the descending trendline and, on extremely high volumes, began a run towards multi-month highs.

At that time, demand clearly dominated – bulls may gain confidence near the $130 mark and prevent a deeper drop in the stock.

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