Range-bound trading for Meta stock as workforce reduction of 8,000 jobs in 2026 weighs

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Meta drops 0.69% as AI costs rise

Highlights

Meta lifted its 2026 capital expenditure guidance to $125–$145 billion to accelerate AI infrastructure despite higher memory component costs.
Q1 2026 revenue jumped 33% to $56.31 billion and EPS beat expectations, but daily active users declined and workforce cuts signal restructuring.
Shares trade below major moving averages with persistent selling pressure; technicals indicate 80%+ likelihood of further decline toward $590–$603 support.

Capital investment surge and restructuring as user growth plateaus

Meta raised its 2026 capital expenditures outlook to $125–$145 billion as the company transitions to higher investment in AI infrastructure, citing increased component costs, particularly for memory. This followed the release of Q1 2026 results on April 29, which showed revenue growing 33% year-over-year to $56.31 billion and adjusted earnings per share of $7.31, exceeding market expectations. The company also announced cuts of approximately 10% of its workforce, with about 8,000 jobs set for elimination, reflecting ongoing restructuring efforts. Additional factors included a reported decline in daily active users in Q1 and a Q2 revenue guidance of $58–$61 billion, indicating a deceleration in the growth rate, while shareholder calls for a content moderation report point to increased governance scrutiny.

Technical resistance mounts as oversold signals offset soft momentum

The $605.00 price level places Meta below the SMA-20 ($647.06), SMA-50 ($630.30), and SMA-200 ($678.29), highlighting key resistance points at all major moving averages. The Ichimoku Kijun line on the daily chart stands at $605.99, acting as immediate resistance, while the current session range is $603.63–$607.72 with intraday volatility remaining low. On the indicator front, D1 MACD remains positive, suggesting room for a technical rebound, whereas the ADX score of 15.48 is neutral and signals a lack of strong trend momentum. Stoch RSI is at an extreme low, D1 CCI is negative with an 'Oversold' tag, and RSI reads 40.76, collectively reflecting oversold conditions. The BBP emphasizes seller dominance within the current daily range.

Downside risk dominates as tight range and selling signals persist

Looking into the short term, the anticipated 5-day price corridor for Meta is $590–$620, consistent with typical volatility around current levels. The probability of further downside is elevated, with over 80% likelihood, given the prevailing alignment of selling signals on both daily and weekly technicals. Sideways consolidation between $603 support and $606–$610 resistance is the baseline scenario, barring a clear momentum shift. A sustained bullish move would require a close and hold above $606, validated by an uptick in supportive indicator signals, while a breach below $603 could trigger accelerated losses.

Viktoras Karapetjanc, expert at Traders Union, sees Meta’s raised capital expenditures as a long-term positive signal despite immediate pressure from rising costs. He believes that resilient earnings and strong revenue growth reinforce the company’s fundamentals, but warns that short-term sentiment is being shaped by restructuring, lower user engagement, and cautious guidance. Macro headwinds and shareholder scrutiny add to the near-term uncertainty. Technicals now reflect a potentially oversold setup with defined resistance overhead. "If the price can stabilize above $606 and news flow turns positive, I expect a constructive reversal could take shape in the coming sessions."

Previously it was reported that U.S. lawmakers are intensifying scrutiny of how major AI companies like Meta guard proprietary technology against national security threats, especially from China. With Meta now ramping up AI infrastructure investments amid restructuring and ongoing governance pressures, investors should closely monitor downside risk toward the $590 level as heightened volatility and external oversight continue to shape the stock’s near-term trajectory.

Source of Data: META Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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