Social media stocks were destroyed on Thursday in the wake of Meta’s (MVRS) disappointing quarterly results.
The company gave a downbeat outlook and explanation for its results and that hammered both Snap (SNAP) and Pinterest (PINS), two stocks that were due to report earnings on Thursday after the close — a day after Meta.
At one point in the day, Snap and Pinterest were down over 24% and 12%, respectively. The stocks were down so badly that at a glance, one would have assumed that they were the ones that reported poor results.
Worth mentioning is that those performances followed a pretty rough Wednesday for both stocks.
In any regard, that's not the case today, with both stocks up nicely on Friday. Let’s look at the charts.
Trading Snap Stock
Chart courtesy of TrendSpider.com
Snap stock soared more than 60% in Thursday’s after-hours session and is up about 50% so far on Friday.
That follows better-than-expected results and a strong outlook.
From here, I’m keeping an eye on the $38.75 to $40 area. That was a former support area in the fourth quarter of 2020 and so far there’s a hesitancy from the stock to cross this level.
If it does and we see $40-plus, I want to see how Snap stock handles its declining 10-week moving average. I would love to see an eventual move back to $50.
On the downside, it’s pretty clear that $30 is a notable level, along with the 200-week moving average. Below both measures and this week’s low could be back on the table.
However, the hope is that the low is in.
Trading Pinterest Stock
Chart courtesy of TrendSpider.com
Pinterest stock is a little different from Snap. For starters, it’s “only” up about 7% on the day, not 50%. Second, the stock has been under far more selling pressure.
Can better-than-expected earnings help reverse the trend?
Currently working on its fifth weekly decline in the last six weeks, the stock is also down in each of the last eight months and in 11 of the past 12 months.
I have found that $27 is a critical level in the short term and would like to see Pinterest stock regain that level in order to trust it on the long side.
If it can do that, $30 could be in play, followed by the declining 10-week moving average.
On the downside, a break out of this week’s low that’s not reclaimed could put more lows in play and will likely shake out the traders who are long. However, investors may start to accumulate more Pinterest below $25.
