Friday, May 18, 2012

FB Facebook 5-Minute Chart IPO First Day of Trading 5/18/12

Here is FB's chart after its first day of trading.  The issue did not go off well. The day was sloppy and ZNGA, Facebook's right hand company, was halted twice in trading and for longer times than the rules and guidelines show what should occur. Other FB traders did not receive trade confirmations even as the closing bell rang.  This was not the first day that the pumper's promised. In fact, many of those pumpers now say this behavior is to be expected, other pumpers are already long gone cashing in and washing their hands of the stock.

The headaches started when 11 AM came and went and FB was not trading as promised.  An announcement said trading would begin at 11:05 AM.  The minutes ticked away and trader's got nervous, something was wrong.  At 11:30 AM, FB began trading with an opening print at 42.05.  This chart is a 5-minute chart (each candle represents five minutes of trading).  The red circles show where the underwriters had to come in to prevent the price from falling under 38. At 11:39 AM, FB was already in trouble and testing the issue price at 38. The defense of 38 is simply done to prevent further embarassment after a long first day of headaches but the underwriters will not support this trade next week. As a technical analyst, one day does not tell you anything, many days will be needed before moving averages will have meaning, but support and resistance to continue the fun on Monday is 42.50, 42.00, 41.00, 40.00, 38.80, 38.30, and 38.00.

Note Added 5/19/12 at 6:32 AM:  FB final print for the first day of trading is 38.23, only 23 measley cents above the issue price. Faceplant. If you are accessing this chart thru Keystone's archive's and sent here by GOOG or Bing or other search engines, type '5/18/12' into the search box on this site and read the midday market action commentary that describes the entire first day of trading for FB in greater detail.
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2 comments:

  1. MCAPMay 18, 2012 at 7:36 PM

    I got filled at 42.95 sold at 40 and did over 10 trades for 10 to 20 cent pops and the last trade got stung like the first trade of the day but ony for a quarter this time.... Lost thousands on it all and all.

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  2. Keystone SpeculatorMay 19, 2012 at 6:48 AM

    Hello MCAP, that was a big surprise today. FB should have easily traded in the 50's to simply match what a typical tech stock does on its first IPO day. Keystone thought FB would trade in the 60's for at least part of the day. All the prognostications were for 40 or higher so the markets, as always, hurt the maximum amount of traders possible, and closed pennies above the issue price at 38.23. Wild, wild day and a sloppy, sloppy first day for Facebook, now probably exploring their option to change the name of the company to Faceplant.

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