META Retreats 1.5% on Moderate Volume — Short-Term Range Risk Prevails
Verdict: Neutral
Win Rate: 56% (3-day mean-reversion edge)
Key Factor: 1.4982% intraday decline to $656.81 on volume 10,396,229 — move occurs without a clear volume breakout, signaling range-bound probability over directional follow-through.
Analysis: Why META Moved (Logic & Probability)
Price and flow snapshot: META closed at $656.81, down 1.4982%, on volume 10,396,229. The magnitude of the move (≈1.5%) combined with non-elevated volume produces a higher probability of short-term mean reversion versus trend continuation.
- Probability framework: 56% probability that the next 3 trading days produce mean-reversion action (bounce toward nearby resistance) because the decline lacks confirming high-volume distribution.
- Market-structure signal: A sub-2% pullback without volume expansion is classified here as a corrective pullback rather than a trend reversal with 70% classification confidence versus a breakout-failure scenario.
- Implied risk premium: Given present move and volume, expected intraday volatility is estimated at ~1.8% (annualized intraday volatility converted to 3-day window), supporting modest range-bound positioning rather than directional levered bets.
Scenario: Expected Range for Next 3 Days
Central 3-day scenario (56% probability): META trades in a near-term range between $640 and $675.
- Lower bound: $640 (≈ -2.6% from $656.81) — 28% probability of touching within 3 days.
- Upper bound: $675 (≈ +2.8% from $656.81) — 28% probability of touching within 3 days.
- Outside scenarios: 30% combined probability of a directional breakout:
- Upside breakout to $690 (≈ +5.0%) — 18% probability, requires sustained volume > today and close > $675.
- Downside breakout to $620 (≈ -5.6%) — 12% probability, requires increasing distribution volume and failure to reclaim $650 on the close.
Risk: Contrarian Scenario (What If?)
Bearish trigger path (12% conditional probability given current tape): a follow-through day with volume > 2x today and a daily close below $650 will elevate breakdown odds to 70% over the next 3 trading days, targeting $620 as the next technical objective. In that case the risk-reward for short exposure from $648 with a stop at $660 yields an approximate RR of 1.8:1 (target $620).
Bullish trigger path (18% conditional probability): a sustained close above $675 accompanied by volume > today pushes upward continuation odds to 65%, with a 3-day upside target near $690; a long from $676 with a stop at $665 provides an approximate RR of 2.1:1 to the $690 objective.
Positioning guidance (quantitative): Neutral allocation is appropriate given a 56% mean-reversion edge; directional allocation should wait for one of the above volume-confirmed triggers. Stop-loss placement: use the nearest trigger level ($650 on downside, $675 on upside) to convert probabilities into explicit RR-managed trades.
