Upside Down

BABA is rallying this morning, still trying to shrug off the Barron's bearish piece over the weekend calling for a much deeper plunge than the China stock has already seen. 

To many contrarian, this sort of setups is ideal---A controversial company and stock which has already been decimated is now essentially being called a fraud and expected to drop 50% more. For the upside down crowd, BABA is something of a textbook contrarian buy. 

Of course, for every one of those contrarian buy signals which seem so enticing in the present and a no-brainer in hindsight, there are plenty of lemons which actually do keep n plunging.

Hence, a stop-loss below $61 or $60 makes sense for any long attempts in order to mitigate risk, seen on the first daily chart below still in a steep downtrend.  

In addition, LULU was a chic pick headed into the autumn months, but the second daily chart below shows the workout apparel maker is following-through lower on its recent base breakdown and may very well be a momentum short candidate.