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Which FANG Stock Will Be The First To Break Out?
MATTHEW GALGANI10:52 AM ET

As the Nasdaq and S&P 500 try to keep the new rally rolling, each of the so-called FANG stocks — Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Google parent Alphabet (GOOGL) — is working on a new base.

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While it's not clear which stock may break out first, Facebook and Netflix have one technical edge over their rivals. The social media giant and streaming leader are both trading above their 50-day moving averages, while Amazon and Alphabet have been trading below that benchmark line.

Facebook is currently just 2% below its potential buy point, while Alphabet (6%), Netflix (7%) and Amazon (11%) have a longer way to go before entering a new buy zone.

Institutional Demand

Facebook also tops its FANG foes in terms of institutional demand for shares, sporting a B Accumulation/Distribution Rating and 1.7 Up/Down Volume Ratio.

Netflix isn't far behind with a B- rating and 1.4 ratio, while Amazon (C-, 0.7) and Alphabet (D-, 0.8) are showing less recent demand, so look for that to improve as they try and complete their bases.

Among the FANG stocks, only Amazon showed a decline in earnings in Q2, with a 78% drop compared to its year-over-year quarter.

Facebook had the biggest gain with a 69% increase, followed by a 67% rise for Netflix and a 27% gain for Alphabet.

Facebook also topped its rivals in the second quarter with a 45% increase in sales. Netflix came in second with a 32% rise.

With the highest possible 99 Composite Rating, Facebook is tied with Altaba (AABA), Autohome (ATHM) and Grubhub (GRUB) for the top ranking in the No. 11-ranked Internet-Content group.

Second-Stage Flat Base

Facebook is working on a flat base with a 175.59 entry. The IBD 50 stock has been finding consistent support at its 10-week line since forming the right side of a base back in January.

In another bullish sign, the relative strength line is within striking distance of new high ground as Facebook nears a potential breakout.

On Tuesday, the stock managed to recoup some of the day's earlier losses and find support at its 10-day line and close down less than 1% for the day.

Heading into the final hour of Wednesday's session, Facebook was bouncing off the 10-day line and up just under 1%. Netflix was up over 2% in above-average and rising volume.

See if the indexes rebound from a shaky start to the short week, and if Facebook, Netflix and the other FANG stock can clear their buy points in volume at least 40% above average.