Rising artificial intelligence expenses push Meta stock down

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Meta slides 1.11% to $564.99 today

Highlights

Meta continues supporting its share price through active buybacks, gradually reducing outstanding shares amid ongoing market pressure.
Significant spending on AI initiatives is raising operating expenses and pressuring margins, while institutional interest in Meta has modestly increased.
Technical signals are bearish across all timeframes, with elevated downside risk and expected trading between $546.82 and $583.16 in the near term.

Share buybacks offset margin pressure amid elevated AI spending

Meta has maintained its program of capital returns through ongoing share buybacks, contributing to a gradual reduction in the stock's outstanding float and underlying per-share valuation support. The company has also sustained high levels of investment in artificial intelligence initiatives, which has led to elevated operating expenses and potential margin pressure in the near term. Alongside these core activities, Meta launched a U.S. Workforce Academy with a $115 million investment aimed at workforce development, while incremental institutional interest was shown by Manchester Financial Inc.'s increased stake. These developments have unfolded amid continuing market pressure on the stock.

Bearish momentum and overbought signals highlight uncertainty

On the technical front, META is trading below its SMA-20 ($573.92), SMA-50 ($593.12) on the hourly chart, and well beneath its long-term SMA-200 ($659.01) on the daily timeframe. Immediate resistance stands at the Kijun level of $577.32. Momentum signals remain negative, as the MACD registers a strong Sell and the ADX confirms bearish domination. RSI reads 41.19, categorized as Sell, but both Stoch RSI and BBP are overbought, while CCI and Awesome Oscillator show neutral stances. The mix of overbought oscillators and negative momentum reveals a notable divergence, highlighting underlying uncertainty despite the persistent selling pressure.

Sideways action expected as downside risk overshadows breakout odds

Over the short term, price action is likely to oscillate within the $546.82 to $583.16 corridor, representing a typical volatility band relative to current levels. The probability of an upward breakout remains very low given current technical signals, while downside risk is elevated if support at $546.82 is breached. A sideways scenario is considered the baseline expectation within this range, and any sustained bullish reversal would require a clear, confirmed move above the $577.32 resistance level.

Anton Kharitonov, analyst at Traders Union, sees Meta’s modest buybacks and institutional buying offset by persistent technical weakness. The stock stays under pressure, with negative momentum and margin risks from heavy AI investment. He notes little evidence of bullish reversal as resistance at $577.32 holds. "Until the price regains key moving averages and momentum turns positive, I remain cautious and see a sideways to bearish outlook for META."

Earlier, analysts noted that Meta and other technology giants were increasing workforce investments to address infrastructure and labor constraints linked to AI-driven expansion. The current market setup adds a new dimension, with technical signals indicating that sustained weakness could intensify if $546.82 support fails, making this level a critical threshold for short-term downside risk.

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

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.