Facebook Facepalm

[TheNegotiator 13]

Since the listing of FB, the stock has dived.

 

 

I've added AAPL, GOOG & NQ for comparison. As I'm sure you're aware, it hasn't exactly been a smooth few days for stocks since the FB IPO, but then FB has done particularly poorly. Why is this? An over-ambitious pricing of the stock perhaps? Or a less than brilliant vision in the eyes of investors for how the company intends to make money? Or maybe it's something to do with all that technical nonsense that happened on the day at the Nasdaq? Well clearly none of these things help. But that's not really why FB has done so badly is it? I don't think so.

 

Technical strength is built on fundamental timing. When the overall market is clearly risk averse, with US and German bond yields continually dropping and the specific risk event of the Greek election looming with the backdrop of a wider European sovereign debt crisis, what is the likelihood of seeing persistent strength in any stock?

 

So why has it dropped so much? When stocks drop they often do so quickly when they are breaking from perceived value. What then supports them as they drop? Previous accepted value which we can indentify by studying technical price charts. But there's no previously accepted value for FB is there? Noooooooooo. Whoops. So where exactly does it stop? Anyone willing to take a gamble?

 

The lesson is that if you're a company wanting to list, think long and hard about doing so before you do. Make sure that investors really believe in you. Make sure that you list when the market is moving the right way or at least not waiting for some big risk event to pass. You are not too big for the market to turn you into a flop. Anyway, whatever. I guess that MZ is still mega loaded and I still think FB sucks. :doh:

[SIUYA 11]

classic combination of many things.

 

It was over priced - in a bull market, over priced stocks can still rally - this is not a bull market (or at least it is in a very nervous phase of one)

 

It was over hyped - see above, and the sector was a little soft. (timing is everything)

Media confused the issue and talked about 100bill float, when that was its value...not the amount raised

This is usually the reality of what really happens when people say they will support the stock (or say they will give you money to trade, or deliver something on time). Until they cut the cheque promises mean nothing.

 

Fundamental information not fully disclosed......if you where a believer and then got told - sorry our fundamental information regards revenues is changing at the last minute.....then it might sap your enthusiasm for buying more or believing the brokers next story.

 

It was an insider led sale....ie its still held mainly by the guys selling out....ie; there is not a lot of free market capital out there. (As I understand it Zuckerman only sold out enough to pay taxes - he is still a true believer) iel......control still rests not with the market float shareholders

 

Technical analysis means nothing until the terrain has been mapped out, once the maps is there then probabilities can be assessed to trade off it.

 

Like you I dont like the thing, but my opinion means nothing.

good article regards it...http://www.bbc.co.uk/news/business-18105608

[Obsidian 10]

...So why has it dropped so much? When stocks drop they often do so quickly when they are breaking from perceived value. What then supports them as they drop? Previous accepted value which we can indentify by studying technical price charts. But there's no previously accepted value for FB is there? Noooooooooo. Whoops. So where exactly does it stop? Anyone willing to take a gamble?...

 

While there are so many uncertainties all around the globe, it would need a lot courage to dive in a water with many sharks...

If I was still trading stocks, I wouldn't take such a big risk.

 

(I agree that FB sucks)