Social stocks have been rocked this week after Facebook and Twitter execs got a grilling from Congress, sparking worries over increased regulation.

Over the past week, Snap and Facebook have fallen by 7 percent, and Twitter by 11 percent.

One of those stocks could be setting up for its second act, said Boris Schlossberg, managing director of FX strategy at BK Asset Management.

"Facebook, I think, is sort of a jewel in the rough at this point simply because the market is ignoring the massive potential of Instagram," Schlossberg told CNBC's "Trading Nation" on Thursday.

While Facebook has so far relied on advertising revenue, it could soon make the pivot to transactions and shopping on Instagram, or possibly online gambling on Facebook itself, said Schlossberg.

"That could be a massive source of revenue the market is completely underpricing at this point," he said. "They recognize the fact that the advertising story is kind of done at this point, but because they have such an aggregation of eyeballs and such a very engaging experience, they can turn it into a more transactional product and if they do, it becomes a whole new story."

Facebook currently generates 98 percent of its revenue through advertising, and just 2 percent from payments and other fees.

Even with Facebook's heavy sell-offs this week, its technicals suggest it has hope, so long as it doesn't cross one crucial support level, said Bill Baruch, president of Blue Line Futures.

"With Facebook you can salvage another ugly week," Baruch said Thursday on "Trading Nation." "There's a trend line that starts at the very beginning of 2017 and it comes in here, right against the low [Thursday] $161. ... A close below there is going to open the door to accelerated selling."

Facebook closed at $162.53 on Thursday. On Friday, the shares were trading close to $164. Facebook's stock has not seen a close below $161 since April.

Twitter looks to be in far worse shape, according to Baruch.

"It failed the 100-day moving average, it's moving below the 200-day moving average and really I don't see this a buy until it hits about $27," said Baruch.

Twitter closed below its 200-day moving average on Thursday for the first time since last September. It's still a 13 percent decline from Baruch's $27 buy level.

Disclosure: CNBC parent NBCUniversal is an investor in Snap.