Chart Source: Poemsview 29th June 2021
Most of us would be familiar with the hot pot restaurant Haidilao and how it has grown rapidly over the years. But did you know that it’s actually listed on the Hong Kong stock exchange? If you did, then did you know that the price has tumbled over 50% over the last 4 months?! Could this be a good opportunity to start nibbling on it?
From the chart and using technical analysis, we can see that there is some support at around $36 as we see it consolidate there for about a week. The next support if $36 fails to hold might $32 then $28. As an investor or trader, we usually look to enter around the support or when we see a stock having test the support and rebound just like haidilao.
Our upside resistance as drawn is around $42, $47 then $50. As HK stocks can be volatile at times we usually look to swing our trades or scale in as investors and not go all in. At this level, it does present a good opportunity to slowly scale in and wait for a recovery as more people get vaccinated and economies start opening up.
The downside risk remains with covid mutating and further lockdown causing retail and F&B to slump.
Share your thoughts on Haidilao with us. We’ll like to hear them.