• 16 hours The True Cost Of Opportunity In America
  • 22 hours Why Investors Shouldn't Ignore Gold Stocks
  • 2 days Facebook Scrubs Over 2 Billion Fake Accounts
  • 2 days Dow Scrambles To Avoid Fifth Straight Weekly Loss
  • 3 days Is This The World’s First Truly Democratic Stock Exchange?
  • 3 days India’s Wealthiest Set To Hold $23 Trillion By 2028
  • 3 days First Quarter Profits Slip For World's Top Oil Companies
  • 3 days The Yuan May Be China's Biggest Weakness
  • 4 days Hedge Funds Having A Banner Year
  • 4 days Disney Heiress Asks “Is There Such A Thing As Too Much?”
  • 4 days BHP Turns Bullish On EVs
  • 4 days Investors Turn Bullish On America’s Nuclear Decommissioning Business
  • 5 days The $90M Inflatable Rabbit Redefining Modern Art
  • 5 days Huawei’s Fate In The Air
  • 5 days Tesla Slashes Prices Again
  • 5 days The Modern History Of Financial Entropy
  • 6 days Italy’s Central Bank Embraces Sustainable Investing
  • 6 days Trump Lifts Metals Tariffs To Cool Simmering Trade War
  • 6 days Researchers Push To Limit Space Mining
  • 6 days Could China Start Dumping U.S. Treasury Bonds?
Strong U.S. Dollar Weighs On Blue Chip Earnings

Strong U.S. Dollar Weighs On Blue Chip Earnings

Earnings season is well underway,…

How Millennials Are Reshaping Real Estate

How Millennials Are Reshaping Real Estate

The real estate market is…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

  1. Home
  2. Markets
  3. Other

Facebook Trade Set-Up

Facebook Crushed Earnings

Overall Facebook is a strong company with great numbers. Including 59% YoY revenue growth, 16 quarters beating earnings estimates, and 2 billion searches per day.

Below is a simple chart of Facebook, 2 days after they crushed earnings. Shown is a 6 month, daily chart using Japanese candlesticks, one of my favorite. Japanese candlesticks can tell a lot when used with other indicators.

Observe the static cycle notated with cycle highs. If Facebook responds to this cycle, it should run into resistance right now using time. I have drawn 4 trendlines on the chart as well, 2 acting as support and 2 acting as resistance. The current one is acting as support.

At the bottom of the chart is a common oscillator currently suggesting momentum is slowing with a bearish divergence.

To sum up, we have a common cycle, trendline support with resistance above, and divergence showing up. This is the trade set-up. 2 ways you can play this, short now with a stop above the current high, or wait for a break of the trendline. Everyone has their own style but make sure you have an exit strategy in case the stock moves in the wrong direction.

Facebook Daily 6-Month Chart
Larger Image

 


DoublePlayOptions does not trade individual stocks, instead focuses on trading the main indexes and etfs that track them. Send an email to admin@doubleplayoptions.com for your next free options play or click here Email If you do not double on the options play, let me know and I will give you a free month of service.

 

Back to homepage

Leave a comment

Leave a comment