Facebook, Inc. (NASDAQ:FB) Market Value Plunges a Record $119 Billion

Facebook, Inc. (NASDAQ:FB) Market Value Plunges a Record $119 Billion

Facebook, Inc. (NASDAQ:FB) Market Value Plunges a Record $119 Billion

Facebook faced a day of reckoning Thursday as its shares plunged in the biggest one-day drop in stock-market history.

The 19 percent drop vaporized $119 billion of the company’s stock-market value; CEO Mark Zuckerberg saw his net worth fall by roughly $16 billion as a result. It was Facebook’s worst trading day since going public in 2012; the collapse eclipsed Intel’s decline of $91 billion in September 2000, without adjusting for inflation.

The plunge followed Facebook’s warning late Wednesday that its revenue growth will slow down significantly for at least the remainder of the year and that expenses will continue to skyrocket.

In a sign of just how bullish investor expectations were, though, the collapse merely returned Facebook shares to a level last seen in early May. At that point, the stock was still recovering from an earlier battering over its big privacy scandal, in which a political consulting firm with ties to President Donald Trump improperly accessed the data of tens millions of Facebook users.

Now come the big questions: Is this a temporary setback, or the start of a painful new road for the giant social network? And does a similar comeuppance await other high-flying technology behemoths?

Both the slower growth forecast and heavier spending reflect problems largely of Facebook’s own making.

New European privacy rules, inspired in part by Facebook’s relentless mining of its own users’ data, are starting to hamper the company’s advertising business. And the increased spending aims, among other things, to prevent a replay of the fake news and propaganda that Russian agents unleashed on an unguarded Facebook in an attempt to sway the 2016 presidential election.

Things could get rougher still. Those European privacy regulations, known as the General Data Privacy Regulation, or GDPR, went into effect with just one month left in the second quarter. That means Facebook could feel its effects more strongly later this year.

For more than a year — ever since Zuckerberg published a 5,000 word manifesto arguing that Facebook needs to make the world a better place by bolstering civic engagement and addressing social ills — the company has seemed torn between its philosophical mission and its economic one. Wednesday may have been the first time this tension really broke into the open, probably because it threatened the one thing all investors care about: Money.

Technical Indicators

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 191.62.

The projected upper bound is: 208.91.

The projected lower bound is: 194.74.

The projected closing price is: 201.82.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.

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 69.1321. This is not an overbought or oversold reading. The last signal was a sell 11 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 63.68. 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 103 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 106.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 5 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 4 period(s) ago.

Rex Takasugi – TD Profile

FACEBOOK INC A closed up 0.290 at 201.340. Volume was 10% below average (neutral) and Bollinger Bands were 26% narrower than normal.

Open     High      Low     Close     Volume___
200.650 203.142 200.210 201.340 12,013,218
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 200.14 190.65 185.17
Volatility: 13 24 31
Volume: 11,484,513 13,337,310 15,453,717

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 8.7% 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 moderate flows of volume into FB.O (mildly bullish). Our trend forecasting oscillators are currently bullish on FB.O and have had this outlook for the last 37 periods.

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