FB Facebook Monthly Chart; Overbot; Negative Divergence; Multi-Month and Multi-Year Top in Play

Facebook has been a stellar stock for the last few years. CEO Zuckerberg is teflon weathering the storm from each scandal that comes along. Facebook steps on privacy issues and anyone participating in the social internet platform must realize your personal information is now in cyberspace forever and accessible to anyone.

The dark maroon lines show that Facebook topped out in January and it appeared that this was the top for the social internet darling. However, price recovers and prints a new high. This is very surprising behavior and would not be typically expected. Facebook is a special case. It owns Instagram that is gaining greatly in popularity. Investors likely surmise that the sky is the limit for FB with such a valuable Instagram franchise under its wings. However, trading is all about what is priced-into the stock at any given time and the monthly chart says the Instagram joy is likely priced-in.

The red lines show the negative divergence across all indicators and the overbot RSI and stochastics. The doji candlestick hints at a trend change lower. Due to the upside acceleration, there is short-term momentum, so price may chop in this elevated area for a couple weeks but the monthly chart indicates that the multi-month and likely multi-year top is in for Facebook. Zuck will be crying in his eggnog come Christmas. 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.