Meta PlatformsLong
META long term trend analysis with fib channel
Updated
Hey traders and investors!
First and foremost I have to say I do not own any META shares right now but I am thinking of building a small position here and keep dollar cost averaging if it goes down to 100$. Here's why: Price action reached a very important swing high from 2016 of about 130$. There is a good chance there will be a bounce from this level, for technical reasons only. The monthly RSI is by far the most oversold it's ever been.
If we look at this beautiful fib channel on the logarithmic scale, we can clearly see that this is the first real downtrend facebook stock has ever faced. So to find potential support levels, I think we can simply look at previous swing highs and monthly candle closes in confluence with fib levels.
So I will be dollar cost averaging when price action reaches the white line, if there's a reaction then fine I can swing trade it and if not I will keep buying and building my position as it reaches the other horizontal lines. If 130$ and 113$ do not hold, there is a high chance of reaching 100$ or even 90$ which would be around a 75% drop from the peak. But I suspect 113$ to 130$ might be where a bottom starts to form in the next few months. Price action dropped about 65% already. META's market cap peaked around 1.06T last year and is now sitting at 360B yet the company is still making money as the entire economy is under a lot of pressure from the FED.
At some point, inflation and the US Dollar will peak, and central banks will go back to printing money because that's what they do. But nobody knows when. That's why I'm thinking of going long now cautiously and I think starting new positions is a great way to have a good average cost basis for long term swing trades. I believe if price action reaches 220$ again there could be a lot of resistance in that area so this would be a good level to take some profit.
Good luck
First and foremost I have to say I do not own any META shares right now but I am thinking of building a small position here and keep dollar cost averaging if it goes down to 100$. Here's why: Price action reached a very important swing high from 2016 of about 130$. There is a good chance there will be a bounce from this level, for technical reasons only. The monthly RSI is by far the most oversold it's ever been.
If we look at this beautiful fib channel on the logarithmic scale, we can clearly see that this is the first real downtrend facebook stock has ever faced. So to find potential support levels, I think we can simply look at previous swing highs and monthly candle closes in confluence with fib levels.
So I will be dollar cost averaging when price action reaches the white line, if there's a reaction then fine I can swing trade it and if not I will keep buying and building my position as it reaches the other horizontal lines. If 130$ and 113$ do not hold, there is a high chance of reaching 100$ or even 90$ which would be around a 75% drop from the peak. But I suspect 113$ to 130$ might be where a bottom starts to form in the next few months. Price action dropped about 65% already. META's market cap peaked around 1.06T last year and is now sitting at 360B yet the company is still making money as the entire economy is under a lot of pressure from the FED.
At some point, inflation and the US Dollar will peak, and central banks will go back to printing money because that's what they do. But nobody knows when. That's why I'm thinking of going long now cautiously and I think starting new positions is a great way to have a good average cost basis for long term swing trades. I believe if price action reaches 220$ again there could be a lot of resistance in that area so this would be a good level to take some profit.
Good luck
Note
Beautiful reaction at the bottom of our -0.786 fib extension to the downside at around 123$. I suspect price action will remain bearish as long as core inflation goes up in CPI reports, but who knows this could also be a long term bottom. My plan is already in action. I will DCA at these 4 levels no matter what happens.Note
We are back above support. If this week closes above 130, that will probably trigger a rally to around 150$Note
Our dollar cost average basis is very good for this stock, will be holding this position for years.Note
Took some profit to buy back lower because this rally has been relentless, and I think we are at major resistance. I believe price will revisit the 175$ range to create some kind of inverse head and shoulders, most likely.Note
Should we take profit yet? Probably.But I do think we will touch the yellow line of the fib channel eventually.
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