Technical Take On Facebook After Adverting Mishap

Facebook Inc FB shares are trading lower by $2.25 at $127.82 in Friday's afternoon session. At this time, the Street is attempting to digest the onslaught of fundamental news on the issue out Friday.

Related Link: Facebook's Inflated Metrics: Why It Matters And What Could Happen Next

Here is a brief recap of that flurry:

• Just before the conclusion of the after-hours trading session Thursday (8:00 p.m. EST), the Wall Street Journal reported that the company inflated a key video metric by 60–80 percent for the past two years.
• As expected, Facebook quickly descended from the $130 area (Thursday's close was $130.08) to $128.30 before the conclusion of the after-hours session.
• Around 5:30 a.m. Friday, Bloomberg Gadfly's Leila Abboud issued her comments on the matter.
• The downdraft continued of the opening of the premarket session (4:00 a.m. EST), not finding a bottom until 8:00 a.m. EST at $126.26.
• After Friday morning's open, Facebook issued a statement regarding the report of video metric miscalculation.
• Facebook managed to float up to the $127.50 by the opening of regular session. Off the opening bell, it quickly bottomed at $127.30 and continued its move higher.
• At this time, it has climbed in the $127 handle and its trading just off its high for the day ($128.60).

Here are a few technical levels to keep an eye for the remainder of the session. In order to fill the void in price action from Thursday's session, it would have to reach $129.56, which was Thursday's low.

For the whole matter to be a non-event in the eyes of Wall Street, Facebook should be able to revisit Thursday's closing price of $130.08.

For investors worried that the news may have longer-term ramifications for the company, they can still exit the issue within $4 of its all-time high that made on September 7 at $131.98. Its all-time closing high was made on that same day at $131.05.

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