I was just asked yesterday if Facebook was a buy.
Since the September 4th low 17.55 in Facebook, from the daily chart i have been on the watch out for a IV wave up.
From the hourly chart i thought the IV wave was complete on October 24th post the earnings result gap. What followed till the 12th November looked like a 1,2,3, wave. The formation of the 4th wave abruptly ended when it entered 1st wave territory on the 14th. The move hence looks like a abc wave corrective move X, or by an unnatural looking 5 count maybe a V.
Since November 14 what we have is either
i) Bearish: a completed ABC (5-2-5) which completes the ABCXABC which should be followed by some immediate downside, starting with a rapid break of 24 and 22.40
ii) Bullish: 123 of a Ist wave higher, with the 4th wave and 5th wave pending.
The doubt in the bear count stems from the fact that the IV wave as of the 26th November has cut into Ist Wave territory with a move above 25.52 which renders the current long term count on the daily invalid and concludes that a new bull market started on the 4th September and the current move is a 123 of a I of a much larger 3rd wave higher.
So all depends on if the current move morphs into 5 waves or starts reversing heavily after 3 waves.
From the hourly chart i thought the IV wave was complete on October 24th post the earnings result gap. What followed till the 12th November looked like a 1,2,3, wave. The formation of the 4th wave abruptly ended when it entered 1st wave territory on the 14th. The move hence looks like a abc wave corrective move X, or by an unnatural looking 5 count maybe a V.
Since November 14 what we have is either
i) Bearish: a completed ABC (5-2-5) which completes the ABCXABC which should be followed by some immediate downside, starting with a rapid break of 24 and 22.40
ii) Bullish: 123 of a Ist wave higher, with the 4th wave and 5th wave pending.
The doubt in the bear count stems from the fact that the IV wave as of the 26th November has cut into Ist Wave territory with a move above 25.52 which renders the current long term count on the daily invalid and concludes that a new bull market started on the 4th September and the current move is a 123 of a I of a much larger 3rd wave higher.
So all depends on if the current move morphs into 5 waves or starts reversing heavily after 3 waves.
