IQIYI (IQ): On The Verge Of A Major Bull Run Or Doomed To Fail?

iQIYI Inc (IQ), a Chinese online video platform, offers movies, television dramas, variety shows, and other video contents to over 500 million monthly active users. The platform provides internet video, online games, live broadcasting, online literature, animations, e-commerce, and social media services to its customers. Additionally, it engages in talent agency and IP licensing activities and is developing a video community app. IQ is listed on NASDAQ as ADR.

Impulsive Wyckoff Sign Of Weakness (SOW) Turned Accumulation

IQ has been in a down trend since March 2021. The Wyckoff change of character (CHoC) on 24 Mar marked the start of a prolonged down trend for IQ.

Let’s focus on the analysis in 2022. The price rallied to hit $5.77 on 1 March with a spike in volume. The rejection tail suggests the presence of supply and weakness ahead. This was confirmed by the impulsive Wyckoff sign of weakness (SOW) in next bars where the price accelerated down to around $1.86 on 15 Mar. The Wyckoff selling climax (SC) was followed by a rapid automatic rally up to around $5.70. The volume during this period is higher, likely suggesting absorption of the supply, changing the down trend into a trading range. The price then retraced but less impulsive compared to…