Facebook has had a tremendous year, but it really started picking up steam over the summer. The stock is up A LOT on good earnings, analyst upgrades and great future prospects; the technical picture has been rather clean, too. In fact, we played a very positive divergence in July just prior to earnings and caught a massive winner.
Today we see Facebook has retreated some from the recent highs in the 50’s. This pullback now offers a great buying chance; after the action on November 13, it really is at the precipice of a big move upward. Momentum indicators are about to turn higher, and we have a great chance to move back up to the recent highs. Options volume has also been off the charts (in bullish territory).
The chart below shows a break of a brief down trend line. Take a look: