Meta Platforms (META) has not fared well in the past 12 months. The calendar year started with a heart-stopping downside price gap in early February. Meta's price has been been cut in half since then and has continued to weaken, so let's see where it might be going from here.
The slope of the 50-day and 200-day moving averages are negative and prices continue to trend lower below these two lagging indicators. The On-Balance-Volume (OBV) line has declined in a similar fashion as prices and its weakness tell us that sellers of META are more aggressive than buyers. The Moving Average Convergence Divergence (MACD) oscillator has been below the zero line for much of the past 12 months and only shows us a cover shorts buy signal this month.
In this weekly Japanese candlestick chart of META, below, we see a bearish picture. Prices are in a longer-term downtrend as they remain below the declining 40-week moving average line. The candles show us plenty of upper shadows but few lower shadows and not bottom reversal patterns. The OBV line has been weak since September 2021. The MACD oscillator is bearish.
In this daily Point and Figure chart of META, below, we can see a downside price target in the $101 area.
In this weekly Point and Figure chart of META, below, we can see a downside price target in the $77 area.
Bottom line strategy: META is expected to report its third-quarter numbers on Wednesday after the close of trading. I have no knowledge of what META is going to tell shareholders and others, but the charts are weak ahead of the numbers. I would continue to avoid the long side of META.
