One last look at the FANG stocks this year. Here are your trades (or lack thereof) on FB, AMZN, NFLX and GOOGL. (December 22, 2016)
FB AMZN NFLX GOOGL FANG GOOGL
I want to look at the FANG stocks here in this video and here is why: I think they have kind of had their teeth filed down a bit. Lets just look and see how these things are trading into the end of the year. I am looking at Facebook ( NASDAQ:FB ) and I think this thing has a lot of problems. I am not talking about the business, though I think they have got some significant issues with their business too. Basically three different times they have said, “Oops, our algorithms, the way we calculate the effectiveness of the ads that are placed, however long the videos are watched, and this and that. Oops, our bad, we goofed-up.” And they were always goof-ups in Facebook’s ( NASDAQ:FB ) favor. Not that that should surprise anyone, but you never know somebody might be. So I think they are having a few issues there.
But the bottom line is, the stock, since early November, had this gap down. It has never recovered. Within less than a week it had come back to try to fill the gap, couldn’t do it. Now the 50-day moving average is pointed down. The 150 and the 200-day are also resistance. If we look here at this, I just call it a moving average matrix, you can see all the different moving averages on this chart. It looks kind of noisy but actually it can present some real clarity here. You can see that this 100-day moving average is kind of like the line of demarcation on the uptrend; now it is the ceiling. So I am looking at this stock and I see it is very heavy. I have looked at some of the other, like money flow accumulation, distribution, etcetera, etcetera. None of them are really worth looking at, it is just under a little distribution. So Facebook ( NASDAQ:FB ), I would stay away from. I think your buying opportunity was a few years ago, not now.
Amazon ( NASDAQ:AMZN ), the jury is still out on this. I would insist that this thing start trading above the 50-day moving average. I would also insist that when it does that, it does it on volume in a wide ranging day. Right now this stock is just kind of in jail. A little kind of a symmetrical triangle that has gone too far. These triangle patterns can be profitable to spot because you wait for the breakout. But typically you want to see the breakouts within the first two-thirds of the triangle. The closer it gets to the apex here, there is really no power left here, and the more likely you are to just get a little trickle. It is hard to envision Amazon ( NASDAQ:AMZN ) going down just because they are Amazon ( NASDAQ:AMZN ). But you have got to pay attention to that, because you could still be a true believer after having held here and you would still be up 15 percent or so in more than a year, but you have had to withstand a heck of a drawdown. Now, we could see a similar thing here in January, so I would just suggest steering clear of Amazon ( NASDAQ:AMZN ).
Netflix ( NASDAQ:NFLX ). This is the best of the bunch with respect to the FANG stocks, but this still has to deal with resistance right around 130.00. So until this stock starts trading above the trendline I am not interested in it, other than being short puts and calls on it, which I am. And then lastly, Google ( NASDAQ:GOOGL ). This potentially is a good one, but only if it starts moving up here as well.
So the bottom line is, these FANG stocks, I think now the attention has gone back to FANG ( NASDAQ:FANG ) the energy company. These large mega cap stocks are, in my view, just not really where you want to be right now. It pays to keep your eyes on them. But I will say this, with a stock like Google ( NASDAQ:GOOGL ), $800.00 stock, that is the kind of thing where it pays to trade options on it as opposed to the stock itself, because you just can’t buy that many shares. Meaning that if you want to buy in fractions as opposed to just piling all in or all out, it is a little tougher to do.
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