Here's Where to Buy Meta Amid Incredible 18-Day Streak
The big tech name is seeing a remarkable trend and traders can target this potential moment as an entry point.
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The trend in Meta Platforms META over the past 18 days has been incredible. Green, day after day, for 18 days in a row. It shouldn’t take long for social media traders to blaze a trail of short or correction calls.
But let’s step back and look at the bigger picture before jumping to conclusions. Two weeks ago, Meta reported revenue of $48.39 billion, a 21% year-over-year increase. Earrings per share clocked in at $8.02, an impressive 50% year-over-year increase. User engagement increased by 5%, while ad impressions saw a jump of 6%. The average price of those ads jumped 14% year over year, creating a positive leveraged effect on advertising metrics.
Management stopped short of providing guidance for 2025, but like many other Magnificent Seven companies, cap. ex. numbers will be big as the company expands aggressively into AI.
In conjunction with the cap. ex. expansion, Meta is reportedly in discussions to acquire FuriosaAI, a South Korean startup specializing in AI chips. This move aligns with Meta's strategy to enhance its AI hardware capabilities and reduce dependence on external suppliers.
Given the market’s love of most things AI now, Meta could position itself to challenge Nvidia’s NVDA dominion over investors' AI dollars. So, before we push back too hard on Meta’s recent run, we need to remember how much momentum Nvidia was able to hold onto for most of 2024.
In terms of the big picture, the move over the past three weeks shapes up more as a breakout on the Meta’s weekly chart rather than an overextended run. Shares are running slightly above the upper Bollinger band, but that isn’t uncommon. The stock along its upper Bollinger band from February 2023 through July 2023. While it is a bit extended from its 10-week exponential moving average (EMA), I wouldn’t be too aggressive on the sell side. Instead, I would consider using any pullback to the 10-week EMA as a possible entry.
At the time of publication, Byrne had no positions in any securities mentioned.
