Facebook, Inc. (NASDAQ:FB) changing expectations in 2019

Facebook, Inc. (NASDAQ:FB) changing expectations in 2019

Facebook, Inc. (NASDAQ:FB) changing expectations in 2019

Social-media stocks have been in the crosshairs over the past couple years, as privacy and safety concerns have investors rethinking the risks associated with these former highfliers. Still, social-media stocks continue to post solid revenue growth, as they build on their efforts to steal advertising dollars away from traditional media. The crosscurrents have made these stocks battlegrounds among investors.

This earnings season, two social-media companies — Facebook (NASDAQ:FB) and Twitter(NYSE:TWTR) are moving in opposite directions. Facebook soared over 10% after its fourth-quarter earnings release, while Twitter declined by a similar amount following its own report.

Despite the scandals of 2018, Facebook’s user count didn’t wind up showing any ill effects in the fourth quarter. Daily active users (DAUs) grew 8.7% year over year, while monthly active users (MAUs) rose an even higher 9%. Even the U.S. & Canada and Europe segments, which many had feared might decline amid privacy and security concerns, grew users year over year. Europe was especially encouraging, as last year’s GDPR (General Data Protection Regulation) privacy regulations don’t seem to have had a lasting effect on Facebook’s European user base.

When asked on the earnings call about robust user metrics despite the large media backlash, Facebook CFO David Wehner said, “about the impact of the … press cycle, I would just probably just let the numbers stand for themselves.”

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 154.27.

The projected upper bound is: 175.36.

The projected lower bound is: 150.50.

The projected closing price is: 162.93.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.

An engulfing bearish line occurred (where a black candle’s real body completely contains the previous white candle’s real body). The engulfing bearish pattern is bearish during an uptrend (which appears to be the case with FACEBOOK INC A). It then signifies that the momentum may be shifting from the bulls to the bears.

If the engulfing bearish pattern occurs during a downtrend, it may be a last engulfing bottom which indicates a bullish reversal. The test to see if this is the case is if the next candle closes above the bottom the current (black) candle’s real body.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 19.3008. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 6 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 58.75. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 6 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -16. This is not a topping or bottoming area. The last signal was a sell 6 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 2 period(s) ago.

Rex Takasugi – TD Profile

FACEBOOK INC A closed down -1.450 at 162.500. Volume was 39% below average (neutral) and Bollinger Bands were 68% wider than normal.

Open High Low Close Volume___
164.510 164.700 160.860 162.500 15,504,415

Technical Outlook
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 166.60 147.01 166.84
Volatility: 23 55 49
Volume: 15,752,181 24,997,136 24,399,528

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FACEBOOK INC A is currently 2.6% below its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of FB.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on FB.O and have had this outlook for the last 28 periods.

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