1 Reason Facebook Shares Are Exploding Today

Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

Facebook Inc FB shares are trading sharply higher by $2.60 (3.4 percent) at $79.31 in Thursday's session. Major news related to the issue were comments by Cowen that Instagram could be valued by as much as $33 billion.

Facebook purchased Instagram in 2012 for about $1 billion.

Another explanation for the explosive rally could be explained by technical analysis. Despite a solid Q4 beat of $0.06 ($0.54 vs. $0.48) on January 28, the issue has not done much, for the most part trading in a $74.00 to $77.00 trading range since the favorable earnings report.

However, in Thursday's session it had not problem clearing that major hurdle at the upper-end of the range. Once breaching that level, it never looked back, steadily climbing the entire day until finding some intraday resistance at $79.75. That level coincides with its December 31 high ($79.80) and the psychological resistance level of $80.00.

Since making that high, it has declined to $79.27 at the time of this article being written.