Stock market: Facebook may close the gap
Trade idea
SELL 192.00; TP 195.00; SL 194.00
This week Facebook Inc. released its earnings figures for Q1. The company’s earnings per share (EPS) and revenue turned out to be better-than-expected: $1.89 and $15.08 billion versus the forecast of $1.62 and $14.97 billion. The number of daily active users of the social network was also quite fine.
However, Facebook faces a lot of challenges. In particular, the company is under investigation because of the user privacy problem. It set aside $3 billion to pay out as fines to the US Federal Trade Commission (FTC). Even though the market’s initial reaction to the earnings report was positive, technical factors, as well as the concerns related to the fines, will likely make the stock price correct to the downside in the upcoming sessions.
At the chart, you can see that Facebook stock met resistance at the 78.6% Fibonacci level of the 2018 decline (198.45). There's also a psychological level of 200.00 that will be hard to overcome. This can make the stock aim for the bottom of the bullish gap in the 185.00 area.
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