Meta Platforms is having another bad day Wednesday. Meta stock dropped around 4% and is on pace for its fifth straight day of losses. Today's loss took on a gloomier tone.
The Facebook and Instagram parent closed slightly below its 50-day moving average on Tuesday and sank further below it Wednesday in heavy volume. That's a sell signal.
The Magnificent Seven stock looked bullish when it broke out of a third-stage cup-with-handle base with a 514.01 buy point on June 27 and climbed as much as 5% from the entry. But the stock has been weakening since a 4.1% sell-off last Thursday.
Meta stock is down 8% from the buy point, which marks another sell rule. Its relative strength line had been trending mostly sideways since February and made a sharp downtrend with the recent sell-off.
The stock holds a worst-possible IBD Accumulation/Distribution Rating of E, indicating heavy institutional selling over the last 13 weeks.
Investors have been rotating out of Big Tech stocks and putting their money into other sectors, a shift that began on Thursday with a jump in odds for a September interest-rate cut.
In addition, it didn't help Meta that former President Donald Trump expressed support for social media platform TikTok.
"I'm for TikTok because you need competition. If you don't have TikTok, you have Facebook and Instagram," Trump told Bloomberg Businessweek in an interview posted Tuesday.
It was reported that he joined TikTok last month.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
