Facebook stock analysis shows that the social media giant suffered its worst weekly price drop since the summer of 2018 last week.
Facebook stock technical analysis shows that the $170.00 level is likely to be pivotal for the direction of trading during this week.
Facebook medium-term price trend
Facebook has staged a solid technical bounce from just above the $150.00 level after sellers closed an important price gap on the charts last week.
The share price of Facebook is currently trading down by over 20 per cent from its 2020 high, and around 15 per cent since the start of the new year.
Facebook stock analysis shows that the $170.00 level offers major trendline resistance this week, and is likely to be a key technical area that traders will look for strength or weakness in the social media giant’s share price.
The daily time frame shows that a large price gap was closed last week around the $150.00 level, and then a sudden recovery to the upside took place as dip-buyers stepped in.
Failure to hold price above the $170.00 level may result in another technical test of the $150.00 level, while gains above the $170.00 level may attract buying towards the $180.00 technical zone.
Facebook short-term price trend
Facebook stock analysis over the short term shows that buyers are only in control while price trades above the $210.00 level.
A large bearish head and shoulders pattern has formed on the lower time frames, with the neckline of the pattern located around the $174.00 resistance level.
The size of the pattern indicates that Facebook’s share price could fall towards the $125.00 level. This is possible given the short and medium-term bearish trend underway in the broader market.
It is noteworthy that a price gap has formed around the $210.00 level and may need to be closed at some point, although this may take time to occur.
Overall, traders should expect the weakness in the share price to continue while price trades below the $170.00 level.
Facebook technical summary
Facebook stock technical analysis highlights that a bearish reversal pattern is signalling more losses towards the $125.00 level. The $170.00 level is seen as an important technical area for short and medium-term traders this week.