Facebook Inc. (NASDAQ: FB) traded slightly higher yesterday, after hitting support at 357.00, slightly above the upside support line drawn from the low of March 4th. Overall, the stock continues to print higher highs and higher lows above that line and thus, we would consider the outlook to be positive.
A break above the high of August 9th could pave the way towards the record high of 377.54, hit on July 28th. Investors may decide to take a break thereafter, allowing a retreat back near the aforementioned upside line. However, there would still be a decent chance for a rebound and break above that record. With no prior highs or inside swing lows to mark the next potential resistance zone, we would consider as such the round figure of 400.00.
Looking at our short-term oscillators, we see that the RSI turned back above 50 and is now pointing up, while the MACD, already positive, looks ready to cross above its trigger line. Both indicators detect upside speed and corroborate our view for a trend continuation in this stock.
In order to start examining a short-term reversal, we would like to see a dip below 348.00, the low of August 3rd. This could also validate the break below the aforementioned upside support line and may allow declines towards the 355.00 area, near the lows of July 19th and 20th, or the 328.00 barrier, which provided strong support between June 10th and 21st. If neither territory is able to stop the slide, then we could see extensions towards the 317.00 area, marked by the inside swing high of May 18th.
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