Facebook, Inc. (NASDAQ:FB) stock isn’t a sure thing in the short-term

Facebook, Inc. (NASDAQ:FB) stock isn’t a sure thing in the short-term

Facebook, Inc. (NASDAQ:FB) stock isn’t a sure thing in the short-term

Facebook (NASDAQ:FB), unlike most other stocks, has the added risk of data breach headlines. Not that the other companies are not also vulnerable to hacking, but because Facebook has already suffered a major incident last year and used up its free pass. So, from now on, it’s on notice, and it cannot afford another one.

By “free pass,” I don’t mean that it didn’t suffer any consequences. FB stock fell 40% from the July of 2018 high to the Christmas lows. And its management had to embark on a public relations tour, which included testifying in front of the governing bodies to justify its existence.

FB also had to hire 20,000 people to sensor its streams and limit the possibility of errant or criminal content. This worries me a bit because more eyeballs sifting through data means higher probabilities of leaks.

The good news is that so far, the added expense hasn’t crippled the operational results. More importantly, neither the users of the Facebook platform nor the advertisers have left the company. I personally know friends who are heavy advertisers and they still prefer using Facebook over Alphabet (NASDAQ:GOOGL).

This is why, recently, Facebook stock has been strong. It rebounded 39% off the December lows. But investors are still on edge. They react negatively, selling any FB headline related to penalties or breaches. The key point to this is how sustainable are the dips.

So far those interruptions in the chart have been minor and short. However, the earnings spike reaction left a giant gap below from $151 per share. So those who enter the stock long here may have to contend with the magnetism from this gap. Not every one of those gaps will fill, but they do leave the stock more vulnerable than normal. Add to it the macro-headline threat and, this week, FB stock has the potential of having an even worse week than last.

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 154.78.

The projected upper bound is: 175.11.

The projected lower bound is: 150.44.

The projected closing price is: 162.78.

Candlesticks

A white body occurred (because prices closed higher 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 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 24.5709. This is not an overbought or oversold reading. The last signal was a buy 0 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 58.36. 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 -57. This is not a topping or bottoming area. The last signal was a sell 7 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 3 period(s) ago.

Rex Takasugi – TD Profile

FACEBOOK INC A closed down -0.210 at 162.290. Volume was 43% below average (neutral) and Bollinger Bands were 62% wider than normal.

Open High Low Close Volume___
160.500 164.150 160.330 162.290 14,345,390

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

Moving Averages: 10-period 50-period 200-period
Close: 165.90 147.50 166.77
Volatility: 17 55 49
Volume: 15,183,073 24,677,896 24,319,132

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 2.7% 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 29 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.

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