Wednesday, February 1, 2012

Facebook's Mountaintop Experience

There has been a tremendous amount of buzz surrounding the much anticipated Facebook IPO over the last several weeks. Today, Facebook has filed for a $5 billion IPO under the symbol FB. It is very significant that Facebook is filing for an IPO while the peak of Minor wave 2 up is unfolding in the S&P 500 and the Wilshire 5000.

From a socionomic perspective, the timing of Facebook's IPO could be signalling a large degree peak in the stock market with another wave of bearish social mood to follow in the near future. It could also be signalling a peak for Facebook as well, given the insane amount of news coverage in the mainstream media that the IPO has been getting, and the insane amount of anticipation for the IPO as well.

Facebook formed in 2004 and its rise from start-up to a large corporation was very rapid, reaching 500 million users by 2010 and over 700 million today. Facebook was featured in the movie The Social Network in 2010, with the movie opening in theaters in October 2010.

There was an insane amount of anticipation for the Facebook IPO:

1 -- Facebook IPO: What to Expect --- ABC News.

2 --  Facebook plans IPO filing as early as next week -- Jan 27, 2012, Bloomberg

3 -- What to expect from Facebook's IPO filing -- Washington Post

4 -- Facebook may file for IPO this week -- USA Today

There has also been a lot of exuberant bullishness on the potential impact of Facebook's IPO on Wall Street as well:

1 -- Silicon Valley braces for Facebook millionaires -- Yahoo news

2 -- Why Facebook IPO is a bonanza for Wall Street -- CNBC

3 -- Facebook IPO will create a money machine  -- Forbes

Given the insane amount of news coverage that Facebook is getting on its IPO, coupled with the exuberant bullishness on the stock market that is still present, Facebook could be approaching a large degree peak.

"Mountain-top experiences" can unravel very quickly, and Facebook could be in for quite a large fall when social mood starts becoming increasingly bearish in earnest as indicated in the DJIA, S&P 500 and the Wilshire 5000.


  1. I really hope this is a sign of the final top. I have had it with the waiting around for all this to end. I would rather take the hit up front and get all the debt purged now then take this over the next several years as the authorities are trying to engineer.
    I have a bad feeling you are wrong though and not only will I lose a heap on my puts as minor 2 makes new highs but they drag out this adjustement forever and we die of boredom instead.

  2. I agree with Steve R here as well......the plain facts are not supporting any type of "wave 2" here at all , and it all changed last Wednesday when Bernanke successfully killed the dollar again with the promise of low rates until the end of 2014.

    I too have tried 'fighting the fed' several times over past years...but now .in light of such strong gov involvement in markets - conceed that our traditional analysis tools (elliot) didnt consider these types of factors..and that they far outway the paramaters set by straight technical analysis.

  3. $compq - Naz/Tech now only a hair from breach of all time highs so......we are literally on the brink of some type of conclusion - as to the effectivness of elliot etc....a new high will negate the pricipals and violate the 'rules'.

  4. There it is Dow almost makes new high NASDAQ smashers through s&p behind still. What happens with e wave if lesser indexes invalidate wave two but s&p for wu stature 5000 don't? Can it still crash ?
    Down under where I live our backwater market needs to rally almost 20% to take out the 2011 high.
    The thing I don't get about all this is I don't think e wave matters in this environment with the eu about to break up we could all have that experience from it's. Wonderful life any day now. And when that happens the market will go from 14000 points to 1 poin when the whole CDS, fiat money industrial complex ponzi scheme comes crashing down.

  5. The S&P and DOW are not indicating negative social mood!

    They are indicating positive social mood. For example, as represented by the facebook IPO.

    When will you understand this? You need to extinguish once and for all your uber bearish mentality.

    The DOW, Nas, RUT, S&P are going onto make NEW HIGHS!