We have been tracking IQIYI (NASDAQ listing), the chinese Netflix since the spring of 2018 when a colleague brought it to our attention. The price at that time was about $25/share and the price went straight up to about $45 soon after. Since that big move up the price started to slide to about $17.50 and then rebounded to $27. The move to $27 was another big spike up similar to the move to $45. From there the price has fallen off slowly and has ground down to about $16.65 on news of the China versus USA "Tariff Wars". We had established an upside target of $39-$45 and our downside target was originally around $19, and the price slid further to $16.65. It appears from the chart and the fundamentals that Smart Money has accumulated a substantial position in IQ, and it is now time to ring the cash register. The whole tariff war was fake news, as China and the USA have certainly hashed out their tariff deal behind closed doors, while at the same time giving the appearance of a brutal public display of animosity that everyone thought would drag on well into the next few years. The charts told us that the stock was being accumulated by the big players who were "flushing out the amateurs". As the price went lower, Smart Money kept up their bargain buying.
Today 11/7/19 3rd Quarter results drove the stock higher by 20% in one day. This is Smart Money doing what they do best-accumulating stock at the low as everyone panic sells as the stock goes lower and then drive the price up during good news that provides a reasonable and believable cover story to the general public so they don't think there is market manipulation at work. After all, the price went up 20% in one day because of the 3rd Quarter earnings report, and not because the price is being manipulated into moving higher by interests who have accumulated it so they can sell it to others when the price goes into orbit.
Where do we go from here? With a target price of $39-$45 range the price will continue to be under pressure to move higher as the price whipsaws up and down in rotations. As retail moves in to buy and scoop up the shares that Smart Money sells to them, the price will then move down and Smart Money will again re-accumulate the shares as retail bails out. This cat and mouse game will go on and as some of the retail traders get into profit as the price moves higher, Smart Money will continue to sell into the rise and re-accumulate the shares as the price falls again. Unlike retail Smart Money never buys when the price is rising, they buy as the price is falling or slowly moving up from the rotational low. It is retail that buys as the price moves higher and higher because they need "confirmation" that the price will move up in the future and is not a trap for bulls. They only buy as price has increased exponentially and their risk is greatest.