FB Daily Chart Shows Cup and Handle (C&H) Pattern with Technical Analysis
Here is a look at FB's C&H in progress. Price is creating a falling wedge vibe but note the RSI slipping away to the downside, and the MACD line is shaky. There is also downside momo shown by the short red bars. The gap fill at 24.80-ish is a logical target. The money flow stochastics and histogram are very constructive and positively diverged so they want to see price flatten and move higher. This mix of indicators hints at sideways movement going forward and promotes the idea that the handle should finish forming in the month or two ahead. The base for the C&H is 18, breakout line at 32.5, a difference of 14.5, so the upside target is 46 if the 32.5 is taken out.
The light blue inverted H&S forecasted the up move to the 30-31 area which was achieved. The 20-day MA under the 50-day MA is another negative for FB. Projection is for flat action and a gap fill at 25-ish, sideways then up to finish the handle over the next couple months. The chart will need reassessed at that time but the projection now is sideways action for the springtime with buoyancy appearing as the summer sun begins, then potential upside breakout at 32.5.
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