Significant Low Established for Facebook

Yesterday's multi-month low at 22.67 followed by an upside reversal and up close on the day at 26.97 left behind a glaring positive divergence on my daily RSI momentum gauge, which is a warning signal that a directional move is nearing or is at completion.

The fact that Facebook, Inc. (FB) also reversed from the vicinity of its lower-channel boundary lines under 22.90, and has followed-through to the upside today, increases my "technical confidence" that a significant low is being established.

That likely ends the most recent decline from the May 1 recovery high at 29.02, and also has the right look for the end of the larger corrective process off of the Jan 28 high at 32.50.

If my work is reasonably accurate, then all of the action since Aug 2012 has the potential to represent a giant, 10-month rounded-base formation that projects much higher prices in FB in the months ahead.

From a nearer-term perspective, FB should traverse to the upside across its 2013 channel, from 23.00 towards 27.00-28.00.