Navigating Facebook's Precarious Technical Setup
![Mike Paulenoff](/assets/cdn/static/mptrader/images/mike-paulenoff.gif?id=853baf5e048aaccf8689bd216813fa18)
by Mike Paulenoff
December 27, 2020 • 12:00 AM EST
During late November into early December, Mike Paulenoff became increasingly concerned about the price behavior of Facebook (FB).
The stock not only was grossly underperforming the NDX but also was in the news constantly in an unflattering light regarding its leader, Mark Zuckerberg, and censorship accusations. Since early November, the NDX is up about 10%, while FB is unchanged.
More recently, on the morning of Dec 15, Mike alerted MPTrader members to the precarious technical setup in FB, writing: "FB is pressing on key nearest support at 269-270, which if violated and sustained will point to a confrontation with more consequential support at 264.50-265.00."
This past Tuesday FB got down to that very support level, reaching a low of 264.63.
In his Dec 15 alert, Mike had noted that a break below that level would trigger downside projections to 248-244. He continues to maintain that FB, which closed pre-Christmas at 267.01, must contain any forthcoming weakness to avert a technical break that has the potential to morph all of the price action since mid-August into a consequential top formation.
On the other hand, perhaps bullish seasonal expectations into year-end will put a floor under FB into early January? Keep an eye on resistance at 280.50, above which FB's downside technical set-up could be neutralized.
Join Mike and our MPTrader members as they navigate the twists and turns of FB, and many other stocks, ETF, indices, and commodity markets into year-end and as we enter 2021.
Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts on
ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international
markets, plus key ETF component stocks in sectors like technology, mining, and banking.
Sign up for a Free 7-day Trial!
More Top Calls From Mike
On August 15, with XLV (Healthcare SPDR, ETF) approaching Mike Paulenoff's target zone (noted in an April 18th post), Mike responded to an MPTrader member's question about whether it was "time to sell and find something with more potential?" Mike wrote: "My short answer: no, it is not yet time to sell (although I will never dissuade anyone from taking profits and from ringing the cash register). My pattern and momentum work argue that upside potential extends from 156 to 161.
On August 6th, when UBER was trading 62, this is what Mike Paulenoff discussed with MPTrader members about the stock's technical setup in the immediate aftermath of the company's quarterly earnings report:"UBER... produced stellar earnings, albeit a bit light on next quarter's bookings. The stock is up 5.9% in pre-market trading within a near-term setup that argues yesterday's spike low at 53.25 ended a 35% correction off of the March high at 82.14.
At 10:45 AM ET on Friday July 26, 2 hours 15 minutes after the release of important PCE (Personal Consumption Expenditure) inflation data, this is what Mike Paulenoff discussed with MPTrader members about SPY (SPDR SP500 ETF):"If I have a concern today it is the unfilled up-gap left behind from last eve's 4 PM ET close at 538.32 to the low of the AM session so far at 541.25.
On June 24, 2024, I posted the following chart-based commentary about PFE (Pfizer, Inc) to the MPTrader discussion room:PFE (Pfizer) has the right look of a setup that is on the verge of entering a central, bullish price thrust from within a December-June rounded bottom formation. Only a failure to push up through and close above the 200 DMA, now at 28.94, followed by a decline that breaks last week's low (6/14) at 26.87 will Neutralize my currently bullish bias... Last is 28.27...
This past Monday, July 15, right after the opening bell, Mike Paulenoff cautioned our members about the technical setup in TSLA (Tesla), writing:"TSLA is in the grasp of a corrective period off of last Thurs (7/11) high at 271.00 that hit an initial low at 231.52 last Friday (7/12). The big rebound off of 231.52 to 262.72 during this AM's pre-market trading has the right look of an "intervening bounce" between two distinct corrective declines (the first being 271 to 231.52).