Facebook, Inc. (NASDAQ:FB) world’s leading social network survives a tough year
Few companies suffered more negative press coverage in 2018 than Facebook (NASDAQ:FB). But the company’s fundamentals are hanging tough. Is FB stock poised to recover some of the ground it lost over the last 12 months? The latest bad news for the Silicon Valley titan is the revelation that Facebook exposed private photos from about 7 million users to apps that weren’t supposed to get them. Those apps were authorized to see a limited set of users’ photos, but a bug allowed them access to lots of other ones.
But with all the controversy swirling around the company, its balance sheet remains strong. While Facebook stock is down more than 30% from an all-time high set earlier this year, it was rising over the past three weeks even as the financial markets have remained turbulent. However, despite this recent strength, the stock still wasn’t able to avoid the pre-holiday dip that most other stocks suffered from.
The company is also refining its News Feed feature to show people the stories most relevant to them, as it competes with Alphabet’s Google News (NASDAQ:GOOG, NASDAQ:GOOGL). The effort includes global crowd-sourced surveys of tens of thousands of people per day, and keeping track of whether a story engaged users in broader discussions. Facebook’s news feature has been the subject of intense political controversy in the media. Liberals in particular complain that the company’s news algorithm allows sources into the mix that are more like partisan propaganda than objective news reporting.
But if Facebook users are upset with the nature of the news function, it hasn’t shown up in the company’s usage figures. FB stock is now selling at about 20 times forward earnings. For a company that combines huge market share with significant growth prospects, that is a rather low figure. For the long term, investors need to find stocks that have proven their ability to dominate their core markets. Despite all the recent controversies, FB stock still meets that description.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 145.49.
The projected lower bound is: 122.09.
The projected closing price is: 133.79.
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 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
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 20.3982. 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 45.30. 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 buy 22 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 -86. This is not a topping or bottoming area. The last signal was a buy 0 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 10.120 at 134.180. Volume was 53% above average (neutral) and Bollinger Bands were 14% wider than normal.
Open High Low Close Volume___
126.000 134.240 125.890 134.180 39,723,368
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 136.73 143.08 169.46
Volatility: 80 53 49
Volume: 32,906,808 26,995,260 28,571,474
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 20.8% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of FB.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on FB.O and have had this outlook for the last 2 periods.
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