Meta shares technical analysis: Pullback follows paused share repurchase program for AI investment

Traders Union
All News
Financial News
Meta slides 3.81% to $638.43 today

Highlights

Meta halted its share buybacks and sharply increased capital spending to support large-scale AI infrastructure buildout, shifting capital allocation priorities.
First quarter 2026 results showed robust operational growth with earnings per share of $10.44 and revenue rising 33% year-over-year to $56.31 billion.
The stock trades below key technical averages with persistent seller pressure; forecast range is $621.87–$665.62 and direction remains neutral until a breakout or breakdown occurs.

Buybacks halted and AI investment surge shifts capital flows

Meta paused its share repurchase program while significantly ramping up capital expenditure to fund AI infrastructure, reflecting a shift in capital allocation priorities and reduced near-term cash returns for shareholders, according to Thestreet. In the first quarter of 2026, Meta reported earnings per share of $10.44 on revenue of $56.31 billion, a year-over-year increase of 33%, further highlighting operational strength in its core businesses. The company also raised its full-year 2026 capital expenditure guidance to a range of $125 billion to $145 billion, citing heightened data center and AI investment needs. These developments signal robust internal growth initiatives and improved profitability, though price action has remained under broader selling pressure.

Bearish pressure persists as oscillators diverge from momentum signals

On the technical front, META is trading below the MA-20 and MA-50 on the H1 chart and also below the long-term MA-200 on the D1 timeframe. The Ichimoku Kijun at $667.57 is acting as immediate resistance. The Moving Average Convergence Divergence (MACD) and Average Directional Index (ADX) both signal a buy, but several oscillators including the Relative Strength Index (RSI) at 49.32 and Commodity Channel Index (CCI) are in sell territory, while both Stochastic RSI and Bull/Bear Power are in oversold conditions. The Awesome Oscillator remains strongly bearish, confirming prevailing intraday weakness. This technical divergence shows MACD and ADX are suggesting underlying momentum potential, but oscillators and price action point to continuous selling pressure.

Volatility expected as breakout risks balance in both directions

The expected price range for META across the next several sessions is $621.87 to $665.62, with equally likely probabilities for an upward or downward breakout. The baseline scenario is for price stabilization within this channel, reflecting typical volatility around the current level. A breakout above $667.57 would open the door for bullish momentum toward the upper part of the forecast range, while a move below $621.87 would reinforce seller control and increase downside risk.

Viktoras Karapetjanc, expert at Traders Union, sees Meta’s strong revenue growth and heightened investment in AI as evidence of sound long-term positioning. He believes the shift away from share repurchases is a strategic move to fuel future competitiveness, though it caps short-term shareholder returns. Technical signals remain mixed, with underlying momentum offset by prevailing selling pressure. "If Meta maintains its focus on innovation, I expect investor sentiment to improve once the current volatility stabilizes."

Earlier, analysts noted that Meta's strong technical posture and escalating AI investments were fueling a broadly positive outlook. The current shift in technicals and capital allocation priorities signals increased volatility ahead, with traders advised to monitor price action around the $667.57 resistance and $621.87 support zones for the next directional cue.

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.