Naked Chart Trading: META 25 Apr 2024
Magnificient Seven Series
I am going to study the US Magnificient Seven stocks as currently in the earning season. Firstly, I will go for Facebook parent Meta Platforms $Meta Platforms(META.US$, which just released its quarter earnings yesterday.
As a result, the stock prices closed around 0.5% lower compared to previous trading session but based on overnight trading price now, the share price plummeting more than 15% despite the better than expected result, but why is this happened? In my opinion, it is most likely caused by disappointing Q2 forecast.
Most of the times, stock prices factored in all existing factors/catalyst, that means Meta's stock prices likely to be factored in the Q1 better than expected result based on the forecast numbers, plus the actual result is not that far from the forecast numbers, that may explained why there is no sharp spike in the stock price, in addition of overshadowing Q2 forecast.
I am going to study the US Magnificient Seven stocks as currently in the earning season. Firstly, I will go for Facebook parent Meta Platforms $Meta Platforms(META.US$, which just released its quarter earnings yesterday.
As a result, the stock prices closed around 0.5% lower compared to previous trading session but based on overnight trading price now, the share price plummeting more than 15% despite the better than expected result, but why is this happened? In my opinion, it is most likely caused by disappointing Q2 forecast.
Most of the times, stock prices factored in all existing factors/catalyst, that means Meta's stock prices likely to be factored in the Q1 better than expected result based on the forecast numbers, plus the actual result is not that far from the forecast numbers, that may explained why there is no sharp spike in the stock price, in addition of overshadowing Q2 forecast.
Based on CNBC news, Meta said it expects sales in the second quarter of $36.5 billion to $39 billion. The midpoint of the range, $37.75 billion, would represent 18% year-over-year growth and is below analysts' average estimate of $38.3 billion.
The stock sell-off accelerated early in the earnings call after CEO jumped into his discussion about investments, namely in areas like glasses and mixed reality, where the company doesn’t currently make money. And he said investments in artificial intelligence are increasing.
So key things I learned here is that stock prices will move based on factoring new catalysts/factors instead of exisiting. Meta stock prices react more to Q2 forecast and company future direction instead of past quarter result, which I think already factored in the stock prices
$Meta Platforms(META.US$ Daily Chart
I drawed a Fibo retracement level from Nov 2022 low to Apr 2024 high. Why Fibo retracement? Because based on daily chart, there is potential signs that META will move into technical correction. From what I circled in blue, stock prices moved into consolidation, showed that buying momentum to take a pause, trend is starting indecisive.
Then there is a potential hand & shoulder bearish reversal pattern if the stock prices closed below USD473. Make no mistake, in bigger picture from Nov 2022, overall trend of META remains bullish, just with possible technical correction in the short term.
Resistance will be seen at Apr 2024 high around USD532, while immediate support at USD473, followed by USD452. According to Fibo retracement level, 23.6% will be around USD426, followed by 38.2% around USD361, 50% around USD309 and 61.8% around USD257
Then there is a potential hand & shoulder bearish reversal pattern if the stock prices closed below USD473. Make no mistake, in bigger picture from Nov 2022, overall trend of META remains bullish, just with possible technical correction in the short term.
Resistance will be seen at Apr 2024 high around USD532, while immediate support at USD473, followed by USD452. According to Fibo retracement level, 23.6% will be around USD426, followed by 38.2% around USD361, 50% around USD309 and 61.8% around USD257
Disclaimer
This content is for reference only and does not constitute any investment advice, and past performance is not indicative of future performance. Returns will vary, and all investments carry risks, including loss of principal. Please make your own investment decisions.
This content is for reference only and does not constitute any investment advice, and past performance is not indicative of future performance. Returns will vary, and all investments carry risks, including loss of principal. Please make your own investment decisions.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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