Bearish prediction for Facebook stock ahead of earnings. I think the resistance line I've marked will be tested again, followed by a bounce, and if the earnings report is good we could see the previous gap get filled. This is supported by the RSI indicator.
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On the daily chart: SXX gapped down through its 200 EMA, a bearish sign
BUT found support at 23.5 on it's weekly 200 EMA
Stochastic on daily chart is trending down and could result in another decline
Also filling the gap at 31.72 could trigger fresh round of selling.
Let's see what happens.
As taught in the Andrews course we can anticipate a new pivot forming at the blue median line. Already showing signs of rejection with the sellers winning the battle at the high.
If price can break the support line then I plan on taking a short if price retraces to test the break.
Current high also looks nice on a channel in the daily view.
the gap we were expecting was very big (especially with euro and yen pairs) but remember that gaps tend to be filled afterwards. So, if this alligns with my structure analysis i think the opportunity is good. The yellow box you see above represents a previous level of structure that acted as support and now could turn into resistance.
As we go on lower ...
Gap still yet to be filled. In an uptrend on higher tfs. Price has broken the 200sma and retested, now clearly stalling. Good time to get in for the gap fill. Price can potentially reach 20775, we'll see how price reacts if it reaches target.