Meta Shares Face Technical Pullback Amid Sector-Wide Caution

Meta US30303M1027

Meta Platforms Inc. saw its share price decline during Friday's trading session, closing at $644.29 for a loss of 1.29%. This retreat reflects a broader wave of investor caution sweeping through the technology sector, where valuations are being reassessed following the substantial rally witnessed in recent months. Despite the company's robust fundamental performance, the stock remains susceptible to profit-taking activity.

Amid the softer price action, Meta has achieved a significant milestone off the trading floor. The company formally concluded its $190 million data privacy settlement agreement with shareholders on November 20, 2025. This agreement, which addresses allegations concerning the board's oversight of user data, now only awaits final approval from the presiding judge. The move eliminates a major legal uncertainty ahead of the year's end.

On the technical front, Friday's trading was characterized by a "risk-off" sentiment across markets. Meta failed to maintain the psychologically important $650 level, slipping toward a support zone identified between $620 and $645. Market observers point to growing skepticism regarding the AI-related valuations of major tech firms—a concern that has intensified in recent days. Should the stock be unable to defend the $644 mark, a test of its 50-day moving average becomes likely.

Strong Fundamentals Underpin Longer-Term Outlook

From a fundamental perspective, Meta's position remains solid. Its third-quarter results demonstrated revenue growth of 26.2%, driven largely by AI-enhanced advertising efficiency. The strategic pivot from pure Metaverse investments toward practical AI integration within its core applications is yielding results, even as capital expenditures remain elevated.

Trading volume data from the recent pullback suggests a period of consolidation rather than a fundamental shift in sentiment. Selling volume did not reach panic levels, indicating that many investors continue to hold for the longer-term narrative. The Relative Strength Index (RSI) is approaching oversold territory, hinting at a potential stabilization in the coming days.

All Eyes on Forthcoming Earnings Report

The market's immediate focus is shifting toward the upcoming quarterly report. Meta is scheduled to release its Q4 and full-year 2025 results on January 28, 2026. Investors will be keenly watching for commentary on advertising revenue trends and the roadmap for future AI investments.

Analyst sentiment remains predominantly optimistic. The consensus price target sits above $818, significantly higher than the current trading level. In the near term, however, the equity must defend support around $640 to avoid further technical weakness. The interplay between sector-wide valuation concerns and Meta's strong operational execution will likely dictate price action in the weeks ahead.