Double Whammy Slams Facebook

Facebook Inc.

shares are trading lower by $4 at $112.06 in Monday's session. It was only three trading session ago, when the issue was knocking on the door of new all time high, which stands at $117.69, when the rally came to an abrupt halt when it peaked at $116.69 last Wednesday and weakened to end the session at $114.70. On Friday, the strong rally in the broad market lifted the issue back to $116.06, but now has distanced itself from that level. There are two fundamental catalysts that have the issue in a free fall in today's session and is attemptimg to find a support level from which to mount a rebound. The main catalyst appears to be the announcement that there is a shipping delay preventing early orders of the much hyped Oculus Rift headset to be received by customers. At this time, the company is trying to compensate affected customers by covering shipping costs for all pre-orders. The other catalyst comes from comments by Ross Sandler of Deutsche Bank, who warned that first quarter results "may come in tight" that may provide investors an "opportunity to add ti positions below current levels." The double dose of negative news instigated a lower open and after a brief rally to $114.55, sellers have flooded the issue. At this time, the issue is trading in the area of its March 24 low ($111.68), so far reaching $111.61 and has rebounded back into the $112 handle. If the decline continues there may be some additional support levels in the lower $111 handle at the pair of lows from March 21 ($111.03) and March 22 ($111.17).