April 16 [HKEX Podcast] Part 2 - Baidu Group, Yangtze Optical Fiber and Cable, Kuaishou
1. After Baidu Group rebounded, it approached a key resistance level. At this stage, it is not yet suitable to directly go short; the bear certificate at HKD 135 is considered a predictive resistance-based deployment.
Baidu Group closed at HKD 123.3 on April 16, with an intraday high of HKD 124.3 and a low of HKD 118.3. The stock saw significant daily gains, continuing its upward trend after rebounding from a low position and quickly approaching the mid-term resistance zone. From the daily chart structure, the share price had repeatedly pulled back from HKD 157.7, testing support near HKD 102.8 before recently recovering step by step from the lows, reclaiming the 5-day, 10-day, 20-day, and 250-day moving averages, indicating a notable improvement in short-term sentiment. However, the current price is already close to the 120-day moving average around HKD 125.6 and nearing the upper Bollinger Band, suggesting that although this rebound has been strong, it has started entering the phase of testing resistance levels.
For investors asking whether it's time to start going short, the answer at this stage remains that it’s still too early. The reason is that the share price has just completed a recovery from a low position, with short-term moving averages starting to stabilize and trading volumes also supporting this move, reflecting that funds have not immediately dissipated after a technical bounce. If one were to directly go short near the current price, it would be equivalent to preemptively predicting a top before the rebound momentum shows clear signs of weakening, which does not offer particularly attractive risk-reward odds. Especially as long as the share price remains above HKD 120 to HKD 121, this rebound structure is not broken, leaving room for further upside testing of resistance between HKD 125 and HKD 127 in the short term.
However, this does not mean that Baidu has fully turned bullish at this stage. From a mid-term perspective, although the share price has recovered from a low, the area between HKD 125 and HKD 127 still represents actual pressure, and further upward moves will still be constrained by the longer-term downward structure. In other words, Baidu is currently closer to testing resistance on a rebound rather than confirming entry into a new major uptrend. Therefore, while bearish positions are not entirely unreasonable, timing-wise, it would be more appropriate to wait for signs of pressure at the resistance zone before considering such a deployment.
As for investors choosing to deploy bearish contracts with a recovery price of $135, this approach reflects an anticipation that the resistance zone between $125 and $127 will be difficult to break through. It also incorporates a defensive bearish strategy by allowing a greater distance to the recovery level. The advantage is that $135 is still a fair distance from the current price, meaning even if the stock price rises in the short term, it may not trigger an immediate recovery. However, this also means that such bearish contracts are better suited for betting on rebound resistance rather than directly countering short-term adverse moves. If Baidu fails to break through $125-$127 and falls back below $120, these bearish positions will start to become more advantageous. Conversely, if the share price effectively breaks through $127 and moves towards $130, the pressure on bearish contracts will significantly increase.
Overall, the most noteworthy aspect of Baidu at this stage is not whether it can immediately turn bearish, but whether there will be significant pressure in the resistance range of $123-$127. If the stock repeatedly faces resistance around $125-$127 and breaks down below $120, it would then be more appropriate to switch to a bearish stance in the short term. However, if it remains above $120 or even surpasses $127, the rebound may not yet be over. Switching to a bearish position now would be a premature predictive move and not the optimal high-probability trade.
After consolidating at higher levels, Changfei Fiber Optic Cable may test the $220 mark again. In the short term, there’s potential for the price to re-enter the $220-$230 range, though the target of $268 remains somewhat aggressive for now.
On April 16, Changfei Fiber Optic Cable closed at $218, with an intraday high of $221 and low of $199. After a sharp rise in previous sessions, the stock exhibited volatility at higher levels. The closing trend on April 16 reflected consolidation followed by an attempt to stabilize. From the daily chart structure, the stock had been continuously pushed up from lower levels, showing a clear medium-term upward trend. Currently, it remains above the 10-day, 20-day, and 30-day moving averages. Although the 5-day line has fluctuated in the short term, the overall moving average arrangement still reflects a bullish pattern, indicating that this isn’t a reversal into a downtrend but more likely digestion after a rapid rise. The upper Bollinger Band sits near $245, while the middle band is around $187. The price is currently operating in the upper-middle region, reflecting that the overall strong structure hasn’t been significantly broken.
For investors asking whether the stock can return to $220-$230, the answer is conditional and should be analyzed separately. $220 is already a very close key level, with the intraday high reaching $221, suggesting that the market has begun testing resistance in this area. As long as the stock can regain and stabilize above $218-$220 and maintain short-term buying support, returning to $220 shouldn’t be a major issue. Afterward, there could be further opportunities to test the $228-$230 range. However, near $230, the price will start approaching areas of prior highs and denser short-term profit-taking, so even if it reaches $230, progress might not be linear but rather involve consolidation along the way.
Regarding some investors in the warrants market targeting $268, this goal is relatively aggressive at this stage. $268 is not only significantly higher than the current price but also clearly above the recent high of $245.8. This implies that the stock must first consolidate at higher levels, break through previous highs again, and initiate another accelerated uptrend before gradually approaching this target. From a technical perspective, a more reasonable sequence for upside targets would first focus on whether the price can stabilize above $220, then look towards $230, and finally aim for the resistance zone near $245-$246. Attempting to directly target $268 without breaking through prior highs reflects an overly optimistic expectation rather than a realistic short-term goal.
Investors holding call warrants with an exercise price of $268.69 aren’t entirely without logic because the underlying stock remains in a medium-term uptrend. However, these products represent out-of-the-money positions that require substantial subsequent gains and fast movement in the underlying asset. If the stock merely rebounds to $220-$230 or fluctuates around $245, it may not lead to ideal performance for these call warrants due to time decay and changes in implied volatility affecting returns. Therefore, such positions are better suited for scenarios where the underlying stock breaks through previous highs and accelerates upwards, rather than just betting on a minor price recovery.
Overall, Changfei Fiber Optic Cable remains in a consolidation phase within its medium-term uptrend. The $218-$220 range represents the first key level for renewed strength. If it can stabilize above this range, the stock has the potential to test $228-$230 or even challenge the previous high near $245. However, if it fails to hold above $220, short-term fluctuations at higher levels may persist. The $268 target still represents a relatively later-stage and aggressive upside level and shouldn’t be prematurely regarded as a guaranteed short-term objective.
After rebounding from lower levels, Kuaishou has preliminarily stabilized. However, $50 has not reached the stage where sustained stabilization can be confirmed, and the area around $43 appears more like a final line of defense rather than an ideal buying point.
On April 16, Kuaishou closed at $47.06, with an intraday high of $47.06 and low of $46.16. Recently, the stock stabilized around the $44.2 low, showing signs of stopping the decline and entering a sideways repair phase. From the daily chart structure, the stock fell from a high of $85.2, subsequently breaking below multiple medium- and short-term moving averages. The overall medium-term trend remains weak. Despite bouncing back from the lows, the stock remains mostly below the 20-day, 30-day, 60-day, and even 120-day moving averages, indicating this rebound is primarily a low-level correction rather than a confirmed reversal of weakness. In other words, although market sentiment has improved compared to before, the technical picture isn't yet at a point where full optimism is warranted.
For investors asking whether the price can stabilize above 50 yuan, the answer at this stage remains uncertain. The reason is that 50 yuan is not only a psychological round-number level but also close to the upper Bollinger Band's current position and was a short-term resistance zone in the previous downtrend. The stock price is now only around 47 yuan, still some distance from 50 yuan. To confidently say it will stabilize above 50 yuan, the price must first continuously break through the 48 to 49 yuan range, then effectively surpass 50 yuan, and stay above it for several days. Only then can it be considered a further upgrade in weakness recovery. If this process isn't completed, it can only indicate that the stock has shifted from a sharp decline to consolidation at lower levels, and it is still far from a true upward reversal.
As for the warrant market, some investors believe that once the bull warrants at 43 yuan are wiped out, they can start building positions. This reflects a common technical shakeout judgment in the market, which is not entirely without merit. Since 44.2 yuan is already a clear recent low, if the price tests the 43 yuan level again, it would indeed approach a point where short-term panic selling and leveraged positions could easily be cleaned out. If the price falls back near 43 yuan and quickly recovers, then stabilizes above 45 to 46 yuan, such movement would resemble a rebound after a shakeout. Considering building positions at that time would offer better risk-reward than blindly chasing the current price. However, it’s important to note that 43 yuan isn’t necessarily a bottom that needs to be broken, nor does falling to that level guarantee an immediate rebound. If 43 yuan is decisively broken downward, it would instead suggest continued weakness, with the next move likely being another search for a lower bottom. Therefore, this area should be seen as a risk observation point rather than an unconditional entry point.
Overall, what’s most worth watching for Kuaishou now is whether the recovery following the 44.2 yuan low can extend to the resistance zone between 48 and 50 yuan. If the stock price subsequently breaks through 48 yuan and gradually approaches 50 yuan, the stabilization pattern from the lows will improve further. If it eventually manages to stabilize effectively above 50 yuan, it can be viewed as transitioning from weak consolidation to a clearer recovery trend. Conversely, if the rebound is weak and the price falls back below 45 yuan, or even breaks down below 44.2 yuan, it would mean the entire stabilization process is still incomplete. For now, we can say that the worst moment might not be worsening rapidly, but to claim it has stabilized above 50 yuan is still premature.
Reminder: This article does not constitute any investment advice.
This article is for reference only and does not constitute any investment advice. The market data, opinions, and analysis contained herein may change at any time without prior notice. We are not responsible for any loss or damage caused by reliance on the information in this article. Technical analysis only shows whether certain technical conditions are met; a comprehensive assessment of asset performance should combine other data and should not solely rely on this article to make trading decisions. Please note that past performance is not indicative of future results. Follow Jenny's insights on Hong Kong stock warrants for more professional analysis.
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