I have found that one of the highest-probability plays is what I call a "royal setup." This simply means that, on the daily chart of whatever security I am analyzing, all the moving averages I like to use are in favor of the setup. For example, if it's a buy setup, I'll want the price to be price above both the 200- and 50-day simple moving averages, and the five-day exponential moving average should be above the 13-day EMA. All of these parameters support a bullish stance.
Beyond that, however, I also want to make sure that the price is not technically extended. In short, I don't buy new highs or lows. I set up the pullbacks after such breakouts in order to keep the odds or probabilities on my side and also to ensure that my risk is very well-defined.
Baidu (BIDU) fulfills all of the above requirements. I don't consider the stock extended based on the most recent data, as it has not met the minimum extension target -- roughly $234.90 -- off the Aug. 1 low. The second target comes in around $241.65.
With those slightly bigger-picture targets in mind, I am interested in buying the recent Baidu pullback right now, as long as the price continues to hold above the $218.95-to-$222.69 area. The pullback zone includes a couple of retracements of prior swings and a relatively important 0.618 retracement. It also includes a couple of 100% projections of prior declines within the larger uptrend -- what I term "symmetry."
If the trend from the Aug. 1 low is to continue, I'll typically want to see the price hold above these prior projections.
Bottom line: The parameters for a bullish Baidu play are taking any buy triggers as long as price remains above the $218.95-to-$222.69 area. I am defining my risk below the $218.95 area, and I am looking at a minimum upside target around $234.90. On the other hand, if these key support parameters are violated, I will back off the buy side until further notice.
Please refer here for more information on trade triggers.
See here for general guidance on Fibonacci trade setups.