- Meta was back and forth during most of the trading session on Wednesday, as we continue to levitate in an area that we had gapped to after the earnings report.
- This is a very strong sign as it shows that the stock may be getting very comfortable near the $770 level, opening up the possibility of a much bigger move.
- That being said, even if Meta were to drop from here, I suspect that there are plenty of buyers underneath willing to take advantage of it being “cheap” on that move.
Technical Analysis
The most obvious thing on this chart is the fact that we gapped higher after the earnings report that of course was much better than anticipated. The market was right around the $700 level, a large, round, psychologically significant figure, and has since gained about 10%. The 50 Day EMA also sits right around the $700 level, a large, round, psychologically significant figure that a lot of people had been hanging out at previously. Ultimately, this is a market that I think will continue to pay close attention to that level, because it is now the bottom of the gap that formed after the earnings call.
In other words, there are a multitude of positive and bullish things in this market at the moment, so I just don’t see how you could get short of this market anytime soon. Meta is one of the ways that people play the artificial intelligence markets, and therefore it has a little bit of a built in bid at the moment. Just above, we have the $800 level, which I think a lot of people will be watching as well, as it is a large, round, psychologically significant figure and I would anticipate that there should be a lot of options being traded in that overall area. If we can break above there, then it will just kick off the next leg higher in Meta.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.