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Facebook Rivals Snap, Twitter Are Nearing Breakouts: S&P 500 Futures | Stock News & Stock Market Analysis

Futures for the S&P 500 index rose modestly late Monday. Facebook (FB) remains in buy range, but smaller rivals Twitter (TWTR) and Snapchat operator Snap (SNAP) closed in on buy points. Meanwhile, Weibo (WB), sometimes touted as China’s Twitter, retook a key support line.

X During Monday’s session, the Nasdaq composite rose for a fourth straight session, leading the modest rally. The S&P 500 index and Dow industrials set record closes.

S&P 500 index and Dow futures climbed 0.15% vs. fair value. Nasdaq 100 futures advanced 0.1%.

Facebook

Facebook rose 4 cents to 179.04 in Monday’s stock market trading, comfortably in the buy zone from a 175.59 flat-base entry. Facebook decisively cleared that buy point in late October and rose to the top of the 5% chase zone by late November, when shares sold off over several days. The stock undercut the entry and its 50-day line, but didn’t fall too far to make the buy point invalid. Shares quickly rebounded last week.

Facebook’s earnings and sales growth remains huge despite the social network’s size, even accelerating in the third quarter. Morgan Stanley touted Facebook, other FANG stocks and Apple (AAPL) on Monday, citing their “substantial competitive moats.”

Meanwhile, Twitter’s revenue is falling while Snap is reporting big losses, and both Facebook rivals are struggling to increase users.


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Snap

Snap came public at 17 in March and shot up to 29.44 intraday on its second day of trading. But shares fell sharply on concerns about user growth and Facebook’s successful cloning of key Snapchat features, notably via Instagram Stories.

Snap hit a record low of 11.28 on Aug. 14 and hit a short-term low of 12.10 on Nov. 8. Since then shares have been moving higher, working on a first-ever proper base with a 16.98 buy point.

Snap shares shot up 7.6% to 18.22 on Monday, helped by a bullish note from Monness, Crespi, Hardt & Co. analyst James Cakmak, who sees the Snapchat app operator’s stock near a turning point. Snap executives seem to recognize the company’s challenges, Cakmak noted. He also cited Snap’s relationship with Chinese messaging and gaming giant Tencent (TCEHY). Tencent bought a sizable stake in Snap in November.

As for Tencent, its shares rose 3.25% to 52.13, continuing a strong rebound from their 50-day line late last week.

Twitter

Twitter popped 4.5% to 22.05 on Monday. That’s approaching a 22.58 buy point in a cup-with-handle base that goes back to October 2016.

Twitter previously broke out past a 20.98 entry on Oct. 27, but within a few days had reversed and soon was down enough to invalidate the buy point.

Keep in mind that both Snap and Twitter are well off 2017 highs, so there could be notable overhead resistance if the stocks break out.

Weibo

The Chinese short-messaging giant rose 3.75% to 104 on Monday, moving back above its 50-day moving average. Volume was below average, so investors should treat Weibo’s move as a buying opportunity.

Weibo does not have a buy point currently. Shares broke out from a 105.60 entry on Nov. 8, rising to 123 on Nov. 21. Shares then fell sharply, wiping out a 16.5% post-entry gain and then some. You should never let a 10% gain turn into a loss.

Weibo is majority-owned by Sina (SINA). Sina rose 2.6% to 99.55 on Monday, below its 50-day line and above its 200-day.

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