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Facebook, Inc. (FB) Message Board

  • keybotthequant keybotthequant Jan 15, 2013 8:01 AM Flag

    FB Chart and Technical Analysis

    FB Daily Chart:

    FB has a big announcement on tap today at 1 PM. Remember what happened at the last big announcement? A faceplant, so today should be entertaining as Keystone digests his sammich (sandwich) and slice of pumpkin pie. FB says they are 'building' something. Everyone assumes it is software or other such mobile advertising break thru, however, if it is simply as cheesy as announcing a new physical building, that will result in an IPO debacle redux. The stock has already ran off the bottom. The bottom was called with the positive divergence, oversold conditions and falling wedge (green lines).

    Note the overbot conditions, rising wedge and negative divergence (red lines) that want to see a spank down and yesterday this began. Even though the daily chart wants to see a pull back, the weekly chart is agreeable to another high occurring afterwards. There is lots going on technically and if a budding technician, you can learn a lot from this chart. There are two inverted head and shoulders patterns (a bullish pattern) in play now, the pink one and the blue one. The pink inverted H&S shows a head at 17.5, neckline at 24.5, thus, target of 31.5 (24.5+7) which was achieved so this pattern was a useful tool if followed. Keystone's 80/20 rule was also satisfied with the move from 28 to 32 and the move from 31.80 to tag the 32.21 high yesterday.The blue inverted H&S is the granddaddy, showing a head at 17.5 and neckline at 33, thus, a target of 48.5 (33.0+15.5). The die-hard holders of FB will not doubt want this pattern to play out. Note, however, that the blue inverted H&S is not in play until price punches up thru 33, which adds to the excitement over the coming days.

    Note the two-leg bull flag pattern from the mid-November bottom to now. The first leg is from 19 to 28, call it 9 points, then the sideways consolidation flag, then price started the second leg higher from 25, thus, 25+9 = 34 target. So lots riding on this 31-35 zone as the big announcement occurs today. If riding this puppy higher and the trade is a big winner, or even a little winner, probably best to jump ship because of the negative divergence. Of course if the announcement blows folks away, the stock is going to jump higher, however, it will need to punch thru the 33 neckline, and also at 34, the bull flag will be satisfied. Since the 33 neck line is such critical support and resistance (look at May-July), even if price punches up thru, it will come back to back test the 32-33 level in the days forward. So the smart move for folks sitting on a bag of Facebook dough right now is to exit, then, even if the stock explodes higher, it can likely be picked up again on a pull back in the days ahead if desired. The weekly chart hints at a jog move across this 31-35 zone and then perhaps a roll over. This is an important day for FB and 33 is its most important level. If price moves above 33, even if it pulls back strongly, the die would be cast to see the blue inverted H&S target discussed above in the months ahead.

    For FB chart use search box above for Keystone Speculator

118.49+0.43(+0.36%)12:12 PMEDT