Meta Could Be Threatening a Big Level
If any word describes Meta Platforms recently, it could be “heavy.”
Notice how the parent of Facebook has made successively lower highs since plunging on a weak quarterly report in early February. It’s hugged the 50-day simple moving average (SMA) since, which provides a clear point of reference for sellers.
Next, the heavy price action is occurring in a range with potential longer-term importance. The May 24 low near $176 closely corresponds with lows between August and October 2019. It was then near a pivot high in March 2020 as the broader market crashed, and was a breakout level in April 2022 as stocks clawed back. This creates risk of more selling should the support zone break.
Third, Bollinger Band Width has compressed to its tightest level since late January. This volatility squeeze may create the potential for price expansion.
Finally, the fluctuations between roughly May 24 and June 8 resemble a bearish flag that META now seems to be breaking.
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Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
Notice how the parent of Facebook has made successively lower highs since plunging on a weak quarterly report in early February. It’s hugged the 50-day simple moving average (SMA) since, which provides a clear point of reference for sellers.
Next, the heavy price action is occurring in a range with potential longer-term importance. The May 24 low near $176 closely corresponds with lows between August and October 2019. It was then near a pivot high in March 2020 as the broader market crashed, and was a breakout level in April 2022 as stocks clawed back. This creates risk of more selling should the support zone break.
Third, Bollinger Band Width has compressed to its tightest level since late January. This volatility squeeze may create the potential for price expansion.
Finally, the fluctuations between roughly May 24 and June 8 resemble a bearish flag that META now seems to be breaking.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. You Can Trade, Inc. is also a wholly owned subsidiary of TradeStation Group, Inc., operating under its own brand and trademarks. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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