Facebook drops 4% on outages and hate speech issues

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Facebook’s (#FB) share price fell more than 4% yesterday as its services including Instagram, WhatsApp, Messenger and Oculus suffered an outage with downtime reported to be over six hours, causing considerable unrest for its users. According to Facebook, the outage was caused by a configuration issue and the company believes that no user data was affected. It should be noted that the social media company is facing new issues regarding hateful content after a whistleblower revealed that Facebook had not handled such content adequately. Still, the company said that “suggesting that we promote bad content and don’t do anything just isn’t true.” We’d love to see how the situation unfolds for Facebook, but we note that other mega-cap tech stocks like Apple (#AAPL), Amazon (#AMZN) and Alphabet (#GOOG) appear to be on the decline, practically pushing down as well. the Nasdaq.

The Facebook (#FB) share price plunged yesterday, bouncing off the 322.50 (S1) support line. We tend to maintain a bearish outlook for the stock price as long as it remains below the downtrend line initiated since September 19th. It should be noted that the RSI indicator below our 4 hour chart fell below the 30 reading, confirming bear dominance, but at the same time may imply that the stock is oversold and a higher correction. could come into play. If the bears really maintain control over the stock price, we could see it breaking the 322.50 (S1) support line and aiming for the 315.70 (S2) level. If an upward correction is made and the bulls gain the upper hand, we might see the stock price break through the 329.15 (R1) resistance line, the aforementioned downtrend line, and target 338.00 ( R2).

RBNZ to raise rates

Tomorrow, during the Asian session, we will have the RBNZ decision on interest rates, and the bank is expected to broadly hike rates by 25 basis points. It is characteristic that NZD OIS implies a 94% probability for the bank to increase rates from 0.25% to 0.50%. But given that this scenario was also expected at their last meeting at the end of August and did not materialize, we remain rather cautious. Concerns over Auckland’s current lockdown appear to continue, but there are some signs of a possible easing from Wednesday. If the bank does not raise rates, which might surprise the markets, we could see the NZD weaken significantly, as it did at the last bank meeting. If, on the other hand, the bank raises rates as planned, the NZD might gain, but attention might also be on the accompanying statement. If RBNZ Governor Adrian Orr implied that given the uncertainty of the Covid situation in New Zealand a measured approach to future rate hikes should be taken, we could see the strengthening of the Kiwi capped and that should be our base scenario. On the other hand, if the tone of the statement allows for a more aggressive approach to future rate hikes, we may see a rally in the NZD.

NZD / USD fell yesterday after failing to hit the resistance line of 0.6985 (R1). Since during its decline the pair broke the uptrend line that had been guiding it since September 30, we are changing our bullish outlook in favor of a bias for sideways movement, for now. However, the RBNZ’s interest rate decision could change the pair’s movement in either direction. If the downward correction turns into asking interest, we might see the pair breaking the 0.6935 (S1) support line and aiming for the 0.6860 (S2) level. If the buyers take over, we might see the pair aiming or otherwise breaking the resistance level of 0.6985 (R1).

Today’s Events and Expectations

Today, among a number of releases, we note the US-Canadian trade balance for August and the US ISM non-manufacturing PMI for September. On the speakers’ side, we notice ECB President Lagarde during the US session and BoJ Governor Kuroda during tomorrow’s Asian session.

Graphic #FB H4

Supported: 322.50 (S1), 315.70 (S2), 308.50 (S3)

Resistance: 329.15 (R1), 338.00 (R2), 345.00 (R3)

NZD / USD H4 Chart

Supported: 0.6935 (S1), 0.6860 (S2), 0.6805 (S3)

Resistance: 0.6985 (R1), 0.7040 (R2), 0.7095 (R3)


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