by Profit Scanner | May 27, 2014 10:09 am
After a precipitous drop from around $72 in March to the $60 range in recent days, traders wondered if they should unfriend Facebook (FB). But recent rumors that the social media stock will add new capabilities to rival Snapchat have renewed interest in FB stock. Does the technical analysis support a continued move up or will the bullish camp snap out of it?
Starting May 19, Profit Scanner powered by Recognia identified that Facebook put in a series of short- and intermediate-term bullish signals including the following:
The most recent intermediate-term classic pattern, the Bullish Continuation Wedge, carries an upside target for Facebook stock of $74.00 to $77.00, which is expected to resolve in 49 trading days.
Resistance for Facebook stock resides at $67.33, so traders with long positions may look to take partial profits at that level if the stock appears to sputter.
It’s always prudent to start with a stop-loss in mind before initiating any positions, and Profit Scanner has pegged a closed below $58.34 as a tight stop based on the technical.
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