Skeptical on buying META; high capex/compensation hurts margins, technicals show resistance and overbought conditions.

Markets will also be closely monitoring a circuit of speeches from five central bank officials for monetary policy clues as well as Meta Platform's developer conference for updates on its AI strategy.

S&P Global estimated capital expenditures from the likes of Alphabet ticker G O G or G OG L, Amazon ticker AMZN, Microsoft ticker MSFT, Meta ticker META, Oracle ticker OCL, and Space Exploration Technology Company or SpaceX ticker SPCX will exceed 1.3 trillion in 2027.

And S&P Global Ratings reported that all six hyperscalers are expected to generate negative free operating cash flow in 26 and 27 with recovery not projected until 2029.

Um Meta was mentioned uh here today. Here's what Meta looks like. It is up 2%. It's sitting right at 680. I'll tell you what, the gap up here today is going to be key because it actually looked like uh we were crossing this downtrend line, possibly going for a support trend line that would offer us a target.

Kind of felt heavy though. Um and actually looked like maybe we were going to find some resistance there. This is what it looked like on Friday. Meta really kind of gave this back.

We're gapping above this today, but I still think that this 672 673 level is going to come into play here today.

So, we'll we'll see on Meta. I don't know if you've had any thoughts here on Meta. Was there news on this this morning? Wells Fargo overweight price target 796.

I mean, I just with the amount of capex they have going and the employee compensation and the share buybacks, I mean, they they I would have to see some uh you know, margin improvement.

Um because that's was that was really hammering uh their margins in the last uh the last quarter report.

I I'm so I don't know what uh what Wells Fargo sees that I'm not. Maybe, you know, maybe they're just very forwardlooking with this company. And you know to their to that their credit meta metas I mean um they have uh you know spent a ton of money and still managed to put up some ridiculously high sales figures but um it's just looks like it's still stuck in this sideways uh yeah this looks like a resistance area to me 13

it it really does. So, um, but you know what's interesting is that we're we're coming up to the end of of this, uh, trend line here, um, that started back in in August of last year.

And I'm just wondering if if we're going to see the other side of it or if it's going to act as a bit of a suppressant to the upside for the price. The other thing is that this is also got some pretty elevated RSI.

So, even if there is a move up higher, I don't think that it's going to um, necessarily, you know, stick around up there that long. I I think the thing needs to cool off either way.

Okay. Uh Amarie here saying short unwinds could give it some juice but not going to step into any breakout lines as we've already discussed here today and thinking about it. You can't go wrong with this mention.

And then while that was happening, I also saw a whole bunch of calls go in some of the bigger tech names. So Intel, Tesla, uh MSTR, Meta. I'm also seeing some here in uh Nvidia, Dell.

So some of the tech names early call buying in some of those.

Uh Meta straight up out of the gate by the way. That went straight to 700. So, for those of you that were on Meta,

Meta wants 700. Meta got it actually 700 is your high print of the morning and S&P rejected at VWAP twice now this morning.

Now it went right to that trend line that we uh just discussed the vet meta. It went to that trend line we discussed. Let's see if it can push through it. Otherwise, it looks like this is coming back in.

RSI is now over 72. This is not where I would want to buy this for, you know, any kind of uh, you know, long position.

Okay, so we talked about this trading up into a resistance area. So far, that's what we've got here. We'll see if Meta finds resistance at that.

And Meta might be uh going for 700 again. And at the highs,

Meta still strong. Meta actually did go through 700 by two cents.

I am seeing some meta puts. So, we talked about Meta trading higher here. That actually went to 715, right? 7:15, 716. I am seeing some meta puts trade here. Although this is still holding higher.

All good. Meta, Tesla, Google says Parker's Thinker Swim indicators. Those have been uh some pretty good large tech movers here today. Here's Meta. This is pulling back a little bit.