Last week’s rally stalled with the last hour selling on Friday and the Viper Report’s Tom Aspray takes a technical look at the market ahead of this week’s CPI report.
For the second week in a row, the weekly changes in the market averages hid the volatility that many traders experienced. As far as big tech is concerned it was another week where some owners of large technology shares were happy, and others were not. Most holders of Meta Platforms Inc. (FB) were not happy even though it was a consistent favorite of guests on CNBC. According to the WSJ a month ago, there were 38 buy recommendations from analysts,11 holds, and just one sell recommendation. Most of the analysts I believe use primarily fundamental, earnings-based data, to determine their buy/sell opinions and price targets. Conclusions based on technical analysis, that depend on the interpretation of hard market data, are often quite different. The weekly chart of Meta Platforms (FB) shows that its price high at $384.33 came last September and it subsequently made a series of lower highs closing 2021 at $336.35. A pattern of declining prices is a sign of weakness. FB closed the week well below its weekly starc- band after dropping over $64. The relative performance (RS) measures how FB performs versus the S&P 500. The RS dropped below its WMA on September 24 th which was a sign that it was acting weaker than the S&P. When FB made its high last September the volume was low and the on-balance-volume (OBV) dropped below its WMA two weeks after the high.
