FB - breaking back under old resistance

Facebook (FB) closed significantly lower by 4%, and settled @ $26.26. This was important from a technical point of view, and the door is now open to somewhat lower levels. First downside target is the 50 day MA, lurking around 23.50. After that, the 22/20 zone would probably provide some strong support.


FB, daily

Summary

FB has been trading in a rather tight trading range for almost a full month. Yet today's weekly close in the low 26s is suggestive of weakness for the next week or two. The decline will very likely get stuck around 22/20 though.

It is difficult to guess if FB will manage to hold the key $20 level, even if the market breaks into the sp'1200s.

What is clear, FB remains insanely overvalued, continues to be surrounded by hype, and the longer term fair value target remains $4. That very low target seems unlikely until late 2013 though.