The last time we reported, we saw Facebook searches volumes head southbound, having hit a low point not seen since mid-2010. Since then, the search trend has continued downward and has hit a low point not seen since April 2010. See chart below:
As you may already know, Facebook’s search volume trend has been counter to the company’s financial performance. Over the last few quarters, we have seen the company blow past year over year revenue and earnings making it hard to believe that the company will show any signs of letting up. But keep in mind, the technology biz is a volatile one where user preferences can flip on a dime.
Since early March 2014, we have seen a bit of a sell off and has been having a hard time breaking the ~$63.60 resistance level, which for a swing trader may suggest a continuation of a consolidation pattern.
I want to reiterate again that I understand search volumes cannot be compared one to one against the stock price and for anyone to place a trade solely on the basis of search volume trends would be quite daring. All I am saying is that search volumes when incorporated with a comprehensive trading strategy such as swing trading or momentum investing can prove itself useful and add to your rationale as to why a position should be maintained or liquidated.