Facebook, Inc. (NASDAQ:FB) earnings hit by fines and growth slowdown
Facebook Inc. has taken a hit of over $5 billion to its earnings in the first half of the year to pay government fines, and on Wednesday it predicted its revenue growth will slow down in the second half of the year.
But investors have barely flinched. Even as the impact from all its privacy controversies and government inquiries is now starting to show up in both the top and bottom line, Facebook FB, +1.14% continues to be a Teflon company for investors.
Earlier Wednesday, before it announced its second-quarter results, Facebook announced a $5 billion settlement with the Federal Trade Commission and a separate $100 million fine to the Securities and Exchange Commission.
And later, during the company’s conference call with investors, Facebook Chief Financial Officer David Wehner said that he expects revenue growth rates will decelerate on a sequential basis.
“We also expect more pronounced deceleration in the fourth quarter and into 2020, partially driven by ad targeting-related headwinds and uncertainties,” Wehner told analysts. When asked for more details, Wehner cited lower price points for ad impressions and tough comparisons with the previous fourth quarter. “Ultimately it’s going to depend on the supply and demand characteristics in that given quarter,” he said in response to a question by one analyst, who said that some were having a hard time reconciling the tougher comp in Q4.
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 189.88.
The projected upper bound is: 215.00.
The projected lower bound is: 195.25.
The projected closing price is: 205.12.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
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 29 white candles and 21 black candles for a net of 8 white candles.
An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend. It then signifies that the momentum may be shifting from the bears to the bulls.
If the engulfing bullish pattern occurs during an uptrend (which appears to be the case with FACEBOOK INC A), it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 75.0915. This is not an overbought or oversold reading. The last signal was a sell 5 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 65.49. 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 7 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 42. This is not a topping or bottoming area. The last signal was a sell 5 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 3 period(s) ago.
Rex Takasugi – TD Profile
FACEBOOK INC A closed up 2.300 at 204.660. Volume was 93% above average (neutral) and Bollinger Bands were 15% narrower than normal.
Open High Low Close Volume___
197.630 204.810 197.220 204.660 32,532,540
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 202.41 188.20 165.49
Volatility: 21 35 42
Volume: 15,405,155 16,560,937 20,726,090
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.
FACEBOOK INC A is currently 23.7% above its 200-period moving average and is in an upward trend. Volatility is low 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 23 periods.