$FB Sell Signals in Social Media and TA-LIB
Many were surprised by the earnings announcement on Facebook which resulted in a massive 19% drop in the value of the stock closing at $176.26. $120 Billion of market capitalization was lost. $FB founder and CEO Mark Zukerburg personally lost $15 Billion. Brokerage firms dropped their target price per shares all over Wall Street.
![Facebook drop 19%, July 2018](https://www.cloudquant.com/wp-content/uploads/2018/07/FB_Crash_20180726-1024x559.jpg)
Whenever something like this happens it gets me thinking. What were the signals that could have helped you see the drop? Were there warning signs?
So after looking for a few minutes, I found a few interesting things that could use some research.
Social Market Analytics (SMA) was reporting (before the close) a bearish S-Score of -1.248. The S-Score is their proprietary measurement of the deviation of a stock’s sentiment intensity level from a normal state. CloudQuant is very much in favor of Alternative Data Sets like those provided by SMA.
Many crowd researchers using CloudQuant are proponents of Technical Analysis and the TA-LIB library for Python. The TA-LIB can produce many signals for Buy or Sell. Sometimes the signals disagree with each other. However, on July 24th there were only two TA-LIB patterns that provided a signal:
- HighWaveCandle indicated sell
- SpinningTop indicated sell
Both of these signals were a complete reverse from the previous day’s buy signals.
I haven’t had time to do further research – but would be interested in knowing if these few observed patterns can be used to become an alpha signal.
The table below shows all the TA-LIB signals for March 5 2018 to July 25 2018 based on Daily Market Data Bars.
For TA-LIB a signal of 100 indicates “Buy” and -100 indicates “Sell”
![Facebook $FB TA-LIB Signals to Sell Prior to 19% Drop](https://www.cloudquant.com/wp-content/uploads/2018/07/fbtalib2018-1024x228.jpg)
How many of you think that this is what Mr. Zuckerburg is going through now? https://www.gocomics.com/nonsequitur/2018/07/06
If you saw other signals comment to us on Twitter!