Finding a Floor Following VR Metaverse Budget Cuts

• • Technically, META bounced from the bottom demand zone around $610.
• • Fundamentally, Meta officially shuttered the VR platform Horizon Worlds on Quest headsets to cut losses and pivot its focus entirely to AI infrastructure.

The decision to shutter the VR version of Horizon Worlds is an efficiency move highly anticipated by Wall Street. The Reality Labs division had previously burned tens of billions of dollars on this metaverse ambition without commensurate returns. By killing the loss-making project and aggressively reallocating resources to Artificial Intelligence (AI) infrastructure and smart glasses development, investor sentiment regarding Meta's profitability and profit margins has surged. Technically, this cost-efficiency optimism successfully prevented a deeper price plunge; META found a solid floor (Weak Low) at the blue box in the $610 area and is now starting to slowly build reversal momentum on the 4-hour chart.

Although this efficiency move is highly favored by equity investors, from a macro technical structure standpoint, META is still under the shadow of a short-term downtrend following a rejection from the $670 area. The price must quickly reclaim the $640 resistance; failure to do so could see selling pressure re-emerge, forcing the price to retest the last line of defense at $610.