Meta’s 20-day winning streak came to an abrupt end on Tuesday, but its impact on investors is still being felt. With no clear near-term support levels in sight, investors are left wondering what happens next. Typically, when buying weakness, there’s at least one reference point to lean on, but Meta is currently in “support discovery” mode.
This means traditional support levels don’t matter, and the stock’s movement is driven by its 20-day moving average. However, with no clear indication of where demand will return, it’s uncertain whether Meta will consolidate or continue higher. Historically, Meta’s 20% gain over short periods has been followed by further gains, but this time around, the stock’s extreme rally raises questions about its next move.
A closer look at Meta’s historical performance after similar surges reveals that only one instance was followed by a decline. In most cases, the stock continued higher over the following months or years. If demand returns during this pullback, Meta may have the chance to consolidate and potentially build a foundation for its next move higher.
Meta has been a leading stock since bottoming in late 2022, outperforming the S&P 500. Its latest surge has amplified this move, raising concerns about whether it’s due for a pause. However, with the Meta/SPX ratio returning to its long-term uptrend, it’s likely that Meta will resume its outperformance once it digests its recent gain.
Source: https://www.cnbc.com/2025/02/19/metas-historic-winning-streak-comes-to-an-end-what-the-charts-say-happens-next.html