Meta Gets an Upgrade But Has a Hard Time Convincing Me

If traders believe that the stock has bottomed I would expect to see more volume as prices increase.
Stocks quotes in this article: META

Meta Platforms (META) was upgraded Friday to "overweight" (buy) by J.P. Morgan on cost discipline and also given a higher price target. The shares are trading higher Friday.

I have no crystal ball on where META will close Friday but weakness in the broader market averages could make result in the stock closing well off its highs of the day. 

However, let's check the charts and indicators for some clues beyond today. 

In the daily Japanese candlestick chart of META, below, we can see that the shares have declined over the past year and even gapped lower in late October. The price gap has been mostly filled and some may argue that we have seen an exhaustion gap but I would not agree.

Trading volume was very heavy on the gap lower as traders voted with their feet. Prices have improved but trading volume is tepid. If traders or other participants believe that META shares have bottomed I would expect to see more volume as prices increase.

The daily On-Balance-Volume (OBV) line has improved and so has the MACD oscillator but these are derivatives of price and the price action is not convincing me. 

 
In the weekly Japanese candlestick chart of META, below, I can see a bearish setup. Prices are in a longer-term downward path as they trade below the bearish 40-week moving average line. The latest weekly candle is a gravestone doji.
 
The weekly OBV line has been weak from last September. The MACD oscillator can only muster a cover shorts buy signal.
 
 
In this daily Point and Figure chart of META, below, we can see a potential upside price target in the $154 area but weakness below $114 is probably going to turn this chart bearish. 
 
 
 
Bottom-line strategy: Every analyst can be wrong -- fundamental analysts and yes, even technical analysts. Buying META here may turn out to be the right call but I am not convinced at this point in time. A break of $114 is likely to precipitate further declines.
 
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