Facebook fell on a strong market day. What does that tell you? (November 19, 2012)

by DAN FB 
I’m Dan Fitzpatrick at StockMarketMentor.com and OptionMarketMentor.com too; why aren’t you over there? Look, Facebook ( $FB Facebook Inc ), you know I talked about this over the weekend noting that there were really two ways that we could trade this and it looks to me like one of our ways is working, the other way is not going to work; and that is if you’re thinking that the stocks just going to continue to break out that didn’t happen, it actually gapped up slightly this morning, right up to this prior resistance level and sold off again. Now I’m not a big Facebook ( $FB Facebook Inc ) freak, in fact I don’t even have an account, I used to but I deactivated it because it was kind of creepy. So I’m not fixated on this stock but a lot of other people are and so what I want to do is, I’ll track this for a bit. My suggestion is, stand aside, wait, let the stock come in, the fact that it fell today, almost three percent, on a massively strong day in the market, very, very, you know very, very good breadth where every single Dow component was up, that’s a strong market. I would not be buying this stock right now, I’d want to wait until I saw either an opportune buy point, which would be right down here around the 50-day moving average, or a blow out to the up side; but my sense is, because of this weakness today, I think you can be careful, I think you can stand aside on this one, let this thing fall to a lower level before you consider taking it and even then, look, it’s still in the base here, you know, it definitely is, today it could have been a different story if it broke out, but it didn’t, and so it’s just in one long base here, so I think you can be patient here, you don’t risk missing the chance to buy this stock, this could hang around for a while. That’s it for this video. Members get over to the Strategy Session; we’re looking at twenty-one different stocks, actually as I look at my list, twenty-two, including the ETFs and there’s a lot of stuff that’s working so let’s get to it.

Free Chart