Jump to content

Meta rallies, but is the low in?


MongiIG

Recommended Posts

Meta has rallied by almost 30% from its low for the year, but is still down 70% from its record high. Is the worst over for the tech stock?

bg_facebook_1384534.JPGSource: Bloomberg
 
 Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 14 November 2022 

Meta stock price bounces, but for how long?

Last week’s weaker CPI figure in the US and news of a wave of job cuts at Meta prompted the stock to surge from its low for the year.

 

Hopes of a slowdown in inflation in the US, leading to a potential slowing of the rate of interest rate increases, caused a broad market rally last week. Tech stocks have been one of the big losers of the 2022 bear market, so it was perhaps not surprising that they were at the forefront of last week’s bounce.

 

In addition, after so much coverage of rising costs, the news that Meta would begin a run of savage job losses also saw the stock gain ground. Investors have watched with concern as Mark Zuckerberg continues to focus on the Metaverse even as revenues fall and costs rise at Facebook, the heart of his empire.

 

Stock now cheap relative to history

Perhaps unsurprisingly, the stock is recently hit its lowest valuation in more than five years. At the low for 2022, Meta traded at just 8.6 times earnings, a remarkable turnaround from its 2020 highs of 25 times earnings.

 

In relative terms at least, Meta is now a bargain. This might tempt in fresh investors, though with a recession still possible in 2023 for the US and indeed the global economy, there is a high risk that cheap stocks like Meta will get cheaper next year.

 

Meta stock price – technical analysis

The weekly chart for Meta shows the extent of the falls over the past twelve months, within the context of the huge rally from 2016 onwards.

 

It is clear that the stock price remains firmly in a downtrend, with even the near-30% surge from the lows of the year only recouping the past month’s worth of losses.

 

Trendline resistance for the stock, beginning in late December 2022, would come into play around $138, leaving the downtrend firmly in place. The 2018 and 2020 lows at $122.89 and then $137.12 would also be potential upside targets in any medium-term rebound.

Meta_141122.pngSource: ProRealTime
Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      23,616
    • Total Posts
      96,995
    • Total Members
      44,180
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    pbate4
    Joined 04/12/23 20:30
  • Posts

    • Forex or Crypto swing trading is a trading style based on identifying swings in the market. Since these swings can take a while to develop, swing trading is most often done over the course of several days or market cycles. If visualized as surfers, traders who utilize this method are out to catch and ride big, long waves. However, in order to catch those waves, traders first need to identify major pivots in the market. What is a Pivot Point? For Crypto or forex traders, it is imperative to know what pivots are and how to spot them. Pivots are the points in the market where price changes direction, from bullish to bearish to bullish, etc. There are important points in price, and there are less important points. Swing traders will not focus on minor pivots, while scalpers will try to take advantage of every minor pivot found. How to Identify Major Pivot Points for Crypto or Forex Swing Trading Major pivot points are easier to spot. They tend to form near support and resistance levels, or they themselves create a new important level. These are points where buyers and sellers are very active. Minor pivots form more regularly and randomly. 
    • The  listing of LSK on the named CEX, with their 20M+ user base will  expose LSK to a different set of traders who prefer or actively use the trading platform esp utilizng their copy trading product. This expanded reach could result in increased trading volume, which is often viewed positively in the crypto space.
    • I just learned about the recent listing of Lisk's utility token LSK on Bitget exchange, I'm curious to understand how this new development might impact both the token itself and the overall Lisk project. Apparently, this listing on Bitget adds another major exchange to the roster, alongside well-established platforms like Kraken, Kucoin, Binance, and OKX. This increased availability on different exchanges generally enhances liquidity and accessibility for traders and investors. More exchange listings can potentially attract a broader audience and bring in new participants to the Lisk ecosystem. To LSK token holders, I'm interested in hearing your thoughts on this recent listing on Bitget. Do you believe it will have a significant impact on the token's value and the project's trajectory? How do you see this development fitting into Lisk's broader goals of making crypto and Web3 accessible to everyone? Let's discuss and share our insights
×
×
  • Create New...
us