I am setting a mental note to closely monitor Chagee (CHA) for potential consolidation around its recent lows in the coming month, coinciding with the IPO lock-up expiration.
The IPO unlock is often accompanied by indiscriminate selling and a surge in supply flooding the market.
Short-term play to capture a rebound over the next 3 to 6 months.
Technicals + ENTRY Strategy
With the Relative Strength Index (RSI) forming higher lows despite price action touching new lows, it will serve as a cautionary green light for me to gradually TWAP shares adding, (not timing bottom).
Fundamental View:
Since its IPO, Chagee’s stock has declined significantly due to several reasons.
Looking into Q4:
I will be watching for the bearish sentiment to subside. Chagee’s story should not end here, given its aggressive expansion of outlets across multiple regions and countries. I expect the stock’s momentum and investor enthusiasm to revive, potentially pushing the price back up to the USD 20-22 range by December or January 2026.
Stay sane, and good luck out there.
Best,
P
The IPO unlock is often accompanied by indiscriminate selling and a surge in supply flooding the market.
Short-term play to capture a rebound over the next 3 to 6 months.
Technicals + ENTRY Strategy
With the Relative Strength Index (RSI) forming higher lows despite price action touching new lows, it will serve as a cautionary green light for me to gradually TWAP shares adding, (not timing bottom).
Fundamental View:
Since its IPO, Chagee’s stock has declined significantly due to several reasons.
- One factor was initial hype driven by its association with popular Gen Z-themed stocks such as Popmart and boba tea chains, which inevitably led to some cooling off.
- Chinese government efforts to curb “involution” and excessive competition have squeezed profit margins for tea chains, as onshore consumers are keenly aware that the cost of a cup of tea often ranges between 1 to 5 RMB, eroding profitability.
- Despite this, Chagee has maintained its premium positioning as the “Starbucks of Tea” and avoided excessive promotional discounts.
Looking into Q4:
I will be watching for the bearish sentiment to subside. Chagee’s story should not end here, given its aggressive expansion of outlets across multiple regions and countries. I expect the stock’s momentum and investor enthusiasm to revive, potentially pushing the price back up to the USD 20-22 range by December or January 2026.
Stay sane, and good luck out there.
Best,
P
Operación activa
On the point of Anti-involution drive by Chinese govt could be better phrased. Tea chains are running promotions so crazy that one cup can be delivered to the consumer at the cost of 5 RMB. Nota
Continue to be active here - adding at 16.5 or better. I see peers in HK starting to find support after a synchronised sell-off since early - mid 2025 IPO. Mixue / 1364 HK / 2589 HK. Slow add with target price around last gap at ~$21.90.
Hopeful trade playout:
Entry: ~16.5
Exit:~$21.90
Holding Period: 4-6 month
Upside: ~32.7%
APR: ~89.5%
Best,
P
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.
Exención de responsabilidad
La información y las publicaciones no constituyen, ni deben considerarse como, asesoramiento o recomendaciones financieras, de inversión, de trading u otro tipo, proporcionadas o respaldadas por TradingView. Obtenga más información en Condiciones de uso.