Like the rest of the market and many other stocks, Facebook (FB) has been on a tear over the past months. But, nothing goes up (or down) for ever. Using Elliott Wave we can determine with often great accuracy where a stock is: is there still upside left or not? What we find is that FB is most likely close to completing a major top, and should start to correct from around $155. The green up arrow shows a perfect Elliot Wave channel, with so far green wave 1, 2, 3, 4 complete and green wave 5 under way. After 5 waves up there is always a correction. Note that wave 4 equalled the length of wave 1 both in time and price, which is classic per Elliott Wave.
If our assessment is correct, then we should see a meaningful low around $110-120 before the stock will do one more larger advance to new highs. From there we then expect an even larger and much deeper correction and holding longs through that period could be very painful…: forewarned is forearmed.