Wednesday, January 30, 2013

FB Facebook Daily Chart Overbot Rising Wedge Negative Divergence Inverted H&S Patterns Sideways Channel

We saw the red rising wedge, overbot conditions and negative divergence a few days back projecting a slap down, which occurred.  Type 'FB' into the search box to reference the previous FB chart for further study.  Price returned for a higher high which is interesting since the universal negative divergence red lines would predict that price would not have to come back up.  The blue neon blue lines show a new rising wedge and negative divergence creating the spank down over the last few days. Earnings hit in one-half hour.  The chart says down but as always with earnings, anything is game.

 Note that over the last few days price is no where near the prior low but the indicators are starting to print matching lows (short red lines). This behavior acts as a weight on price and will try to pull price lower.  The sideways black channel may be a path forward, thru 27-32 for a while. The pink inverted H&S pattern played out when price reached the 29-31 area. The blue inverted H&S, much larger, with head at 17.5 and neck line at 33 would target 48.5 returning FB to its initial offering area.  Projection is for FB to churn sideways for the forseeable future perhaps thru the 27-32 channel. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

 Note Added 1/30/13 at 4:09 PM:  Bottom line EPS beats by two pennies, 17 cents versus 15 cents, and top line, with better revenue than expected, 1.59 billion versus 1.53 billion, good numbers. The knee-jerk reaction is down over 10%.  FB is 28.77 down two bucks. It will need a while to settle out. Zuck pulled it out but the trader's are not impressed.  Mobile users overtaking desktop users. Perhaps the idea is that the money is made with the larger screens and more ad offerings. With the shift to mobile occurring, and that ad strategy probably unable to generate the same revenue, traders may be getting nervous for future numbers.  The growth rates are slowing slightly as well. FB is coming back now at 30.32.

 Note Added 1/31/13 at 9:00 AM:  FB receives three downgrades this morning from Wall Street firms.
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10 comments:

  1. ArnieJanuary 30, 2013 at 4:59 PM

    regardless how well FB would do, the charts were indeed already telling the story on how price would react; and not surprisingly it did react downwards. Glad I sold FB a few weeks ago and never touched it again. Time to reload the boat in a few weeks from now!!!

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    1. MCAPJanuary 30, 2013 at 10:00 PM

      I dumped a ton of it on 11 Jan to bad about the raid this evening I really thought it would go under 28 I had that area blanketed with buy limits but to no avail the algo's didn't take that low. It's monster everyone is pushing it up, talking it up wouldn't surprise me to see it up tomorrow and near its ipo price within 2 months. I like the vol support and the gap for a bang em pray bulk up opportunity.
      http://scharts.co/WzFwwt

      Delete
    2. Keystone SpeculatorJanuary 31, 2013 at 5:57 AM

      The volume candles on that chart favor a move forward thru 26-32. FB should get back to the IPO price in the future but not convinced that it is coming real fast. If the neckline gives way to the upside at 32-34 then the bulls will rule. Lots of folks played around at 31-33 after the offering in June-July after the intial dip, some of them held on only to see FB drop like a rock in August. Now that price is back up at 31-33, these folks are finally back to even and are trying to decide if they should stick with it or be grateful it came back and jump ship. Typically, folks will jump ship. So some churn would be anticipated in the current price range which is occurring. Feels like lots of sideways ahead, perhaps a wait and see attitude by analysts and traders, but above 33+ would ignite excitement.

      Delete
  2. AnonymousJanuary 30, 2013 at 6:18 PM

    KS, this is a very shallow pullback on the SPX. Could be a bear trap. Though if Demark's exhaustion cycles are correct, correction should begin here since his sell signal was triggered last Friday on the weekly chart. Under what conditions would Keybot flip to the bear side?

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    1. MCAPJanuary 30, 2013 at 9:54 PM

      where do you get the Demark indicators trade station?

      Delete
  3. Keystone SpeculatorJanuary 31, 2013 at 5:58 AM

    Keybot is interested in utilities and copper these days although volatility has jumped ahead as of yesterday. Watch VIX 16, above and bears plan on doing some damage moving indexes well lower, if the VIX stays under 16, the correction likely will be shallow.

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  4. MCAPJanuary 31, 2013 at 8:37 AM

    KS as I hear the chatter Util could be a weakening but that Copper is strong but could weaken if prices trade below 3.7365 which on the 30min HGMar'13 doesn't appear for now to be happening anytime soon as in the next hour or so LOL

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  5. Keystone SpeculatorJanuary 31, 2013 at 9:28 AM

    The POT, UPS and Dow Chemical news this morning took a bit of the wind out of copper. Cu is at an interesting juncture, the top rail of the long-term sideways triangle. Using the 80/20 rule, the print above 3.80 with copper would lead the way to 4.20. So copper probably has a little bit of space remaining where it could still reverse to help the bears. Once over 3.80, however, looks like the bulls in the market mean business and the prognostications for far higher markets will probably come true. Current thinking is that Cu will not get thru the 3.80-ish, but, anything can happen these days.

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    1. MCAPJanuary 31, 2013 at 11:03 AM

      volitility in both oil and gold up the mountain yesterday down the mountain today....

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  6. MCAPJanuary 31, 2013 at 11:27 AM

    hey how do you like that RSI divergence on the daily chart of March Crude Oil makes you want to buy some ERY and then have it drop a quarter 1 min after hours and then have to hold it for a week just to trade it off with a nickel profit... I need vacation all the best to you and all the traders here on this blog I'm out early today.

    ReplyDelete

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