FB

From the time I posted about closing FB, you left a total of about $.11 on the table from the highs of the day. You may recall the 1 min chart was one of the only ones holding up well and giving us a good signal all day until later in the afternoon something changed.

Something changed and shortly after that the steady uptrend in afternoon price also changed as it broke below the trendline.

A lot of people seem to be confused as FB saw 777 mn shares unlocked today and would expect FB to be down huge on those insiders selling their shares and getting paid. I mentioned several times FB should be higher by the time the lock-up ends, that's part of the job of the underwriters of the IPO, GS and MS.

In addition to that, we've ben watching what appears to be a base of some consequence, so why sell today? As I said, if I had a bigger position open it probably would have been only half the position closed, but I'm not quite sure what the added 777mn shares will do to our signals and I suspect after a 1-day move of 12.59%, there's probably going to be an opportunity to buy FB back at a better price unless we see follow through and FB is moving to a stage 2 breakout. Even if that were the case, there's still plenty of opportunity, but when there's risk you can't quantify and you are left with options that aren't much better than a coin toss, you don't have the kind of edge you should have to be in the trade.

When I'm trying to decide whether to close a position like this or not, I often ask myself, "If you didn't have any position here, would you buy FB right here at this price today?"; that helps put things in perspective.

While I still suspect FB is carving out  nice base, these two charts (actually the same chart) puts things in perspective for me.

 This 15 min chart suggests FB is carving out  substantial base, however if we take a closer look at the same chart to determine near term actions...


This is the same 15 min chart, just zoomed in.

I'd rather wait and make sure the edge remains or grows.