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Is a Facebook Breakout Imminent?: Must-See Chart

NEW YORK (TheStreet) -- Over the long term, fundamentals play the largest role in where a particular stock is headed. Over the short and even intermediate terms, though, technicals can be a significant driver in a stock's price action. 

The power of technical analysis is undeniable. Many traders live and die by their charting skills, sometimes trading minute-to-minute or day-to-day. For investors who use fundamentals to chose their investments, using technicals can help with choosing a proper entry. 

The stock I've been stalking pre-earnings is Facebook (FB - Get Report). Last quarter, the company reported strong results and traded higher in the after-hours session. However, management mentioned that teens may be beginning to shy away from using the platform. 

As you can imagine, investors immediately dumped the stock and pushed the share price lower. It was a complete overreaction, especially considering everything positive the company had done in the quarter. 

That was in late October. Since bottoming near $45, the stock has rallied higher, but has struggled to get past $58.75. Courtesy of StockCharts.com, check out the chart below:

The stock formed the bullish technical pattern known as an "ascending triangle," highlighted by the two blue trend lines. This is when a stock has support trending higher but resistance at a standstill level. In Facebook's case, resistance is near $58.75, while support continues to follow the stock price higher. 

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