Is it too late to friend facebook (FB)? Here’s your trade. (May 01, 2017)
FB
We are going to look at Facebook ( NASDAQ:FB ). The company reports earnings after the bell on Wednesday so this has two more days of trading. I really can’t see this stock falling down before earnings, unless it is 5-minutes to 4:00 on Thursday, just because traders are taking their profits. What you have got to realize on this is, this has been in a multi-year uptrend, you know this, I don’t have to make that point. If we just draw a general line right around there, Facebook ( NASDAQ:FB ) is up at the top of the channel. It is an uptrending channel, so even though it was up at the top of the channel here and then pulled back, ultimately that turned out to be an okay time even to buy it.
But, would I buy this now before earnings? I can’t do it, I can’t do it. If you look at where this is on the daily chart relative to the 50-day moving average, it is up 9 percent, not a big deal. But it is generally not that far above this key moving average. The reason is because it is in a nice uptrend. So the 50-day moving average is tracking along with this. I might buy it right now for a trade for a couple of days, but what I am telling you is, that this is a real high-risk time to be buying this stock. Now, if you own it hopefully you have owned it for a long time. Know that the stock has gone somewhat parabolic in a fairly short period of time.
I would suggest taking some off the table prior to the close on Wednesday. Take some of your profits, you’re profitable, you can’t help but being profitable unless you bought right at the high today. Take some of your profits off the table prior to the end of the day on Wednesday and then you put yourself in a win-win situation. If the stock pulls back then you are happy that you sold some and then you can say, “Well thank you very much, I will buy some more back.” On the other hand if the stock moves even higher then you can say, “Well I am glad I hung on to some and I will wind up selling into that at some point.” So by taking some stock off the table, take some of your profits before a key report like earnings, you are literally putting yourself in a no lose situation. The only question is, how much are you going to win? That is my take on Facebook ( NASDAQ:FB ); I hope it helps you.
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