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The recent surge in Meta Stock and its peers has sent the NASDAQ 100 index to record highs. The benchmark index peaked at $18,417 points last week and has been consolidating since then. Tech stocks, including the shares of Meta Platforms Inc., suffered a major correction last Friday and have been recovering since then.
On Wednesday, NASDAQ: META opened 0.81% lower than the previous day's close. The pullback comes after the stock failed to break above the key psychological barrier of $500 earlier this week.
The chances of a bearish reversal are increasing as the broader tech stock rally seems to have been halted, with most stocks having sharp rejections at the end of last week. Nevertheless, the rate hike expectations of the market participants remain elevated despite hotter-than-expected inflation numbers for February 2024.
While the CME's Fed Watch Tool shows only a 1% chance of a rate cut in March's FOMC meeting, the expectations are 12.5% and 65.5% for the May and June meetings, respectively. These expectations are fuelling the bullish sentiment in the equity markets as decreased rates would increase the liquidity in high-risk assets.
The latest SEC filings reveal significant insider selling at the Facebook parent as the stock trades at record highs. On 8th March, Meta Chairman and CEO Mark Zuckerburg sold 32,794 shares of the social media giant, raking in $16.7 million. The billionaire founder of Facebook still controls 958,000 shares directly and a similar amount indirectly.
The NASDAQ: META chart below shows that the shares have formed a lower low on the daily chart for the first time in many months. While this is not a significant low, the selling pressure points toward a potential shift in the market structure.
Therefore, Meta stock price prediction may take a bearish turn if bulls fail to strengthen their hold above $500 soon. In case of a deeper pullback, the price gap below $453 might get filled which was left after a massive gap up opening due to strong Q4 earnings.
