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February 6 Chart of the Day - PDD Holdings

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PDD Holdings (PDD) is a Chinese multinational commerce group that owns and operates a portfolio of businesses. PDD Holdings aims to bring more businesses and people into the digital economy so that local communities and small businesses can benefit from the increased productivity and new opportunities. PDD Holdings has built a network of sourcing, logistics, and fulfillment capabilities, that support its underlying businesses.

The company has repeatedly been mentioned in the same breath as Alibaba (BABA) lately for good reason by becoming China's biggest eCommerce company.  In December 2023 PDD's market capitalization surpassed that of Alibaba to make it the most valuable U.S.-listed Chinese company. 

Some may not have heard of them yet because along the way they changed their name from Pinduoduo Inc. to PDD Holdings, Inc. And while the leadership team are clearly Chinese the company reportedly was incorporated in the Cayman Islands but based in Ireland...

Regardless of all the seemingly hocus pocus we wanted to review their chart from a price action technical analysis perspective.

On the monthly chart we can see price's meteoric rise after the 2018 IPO in the low 20s up to $212.60 in early 2021.  Since then price has both fallen fast and risen fast...

So in other words lots of price movement.

Price recently was rejected at the bear 78.6% retracement around $152.80 and has since faded to $125 area where it was trading earlier today.

On the weekly chart we can see for the past two years price has been making a series of higher highs and higher lows /aka/ an up trend.

But can that continue?

If it can we've used a series of bull Fibonacci retracements to provide potential pull back long levels of interest.

We can also clearly see a trend line supporting the price action.

From this information, both traders and investors can formulate plans to fit their respective styles.

So what's next? 

We don't make predictions...

Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.

  1. Support/Resistance
  2. Trend
  3. Fibonacci 
  4. Supply/Demand Zones,
  5. Change Control Zones

Take a look at the charts and let us know what you think.  

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