Market downturns are always good to spot the next leaders. The market downturn of 2016 is no different. Now there are additional data points showing that Facebook FB, may be the next Apple AAPL. No, Facebook will not start making phones. No, Facebook will not have a low P/E like Apple. I am talking about stock performance like Apple of yesteryear.
Five stages
According to ZYX Change Method, there are five stages of a long trade based on change. The annotated diagram shows that Facebook is early in stage three. This is where roughly Apple was in 2011. Subsequent to 2011, Apple stock showed large gains. The same expectation is now for Facebook. The diagram also shows Apple is now in the fifth stage.
Please click here for an annotated diagram of the five stages.
Relative strength in 2016
Facebook has shown relative strength in the year 2016. As the annotated chart shows, Facebook has outperformed S&P 500 Index as represented by the SPDR S&P 500 ETF Trust SPY, by 6.47% at the time of this writing.
In contrast, Apple has underperformed the same index by 2.45% at the time of this writing…Read more at MarketWatch
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