Facebook Inc (NASDAQ: FB)

Facebook, Inc. provides various products to connect and share through mobile devices, personal computers, and other surfaces worldwide. Its solutions include Facebook Website and mobile application that enables people to connect, share, discover, and communicate each other on mobile devices and personal computers; Instagram, a mobile application that enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends; Messenger, a messaging application to communicate with people and businesses across platforms and devices; and WhatsApp Messenger, a mobile messaging application.

Take a look at the 1-year chart of Facebook (NASDAQ: FB) below with added notations:

1-year chart of Facebook (NASDAQ: FB)

FB has been in an overall uptrend for almost the past entire year. However, the stock has recently stalled, as FB has hit the same resistance at $175 (red) on two separate occasions. The stock is currently sitting just under that level now, and a solid close above the $175 should lead to another leg higher for FB.

The Tale of the Tape: FB has a 52-week resistance at $175. The possible long position on the stock would be on a breakout above that level with a stop placed under it.

Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.

No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!

Good luck!

Christian Tharp, CMT