Monday, July 8, 2013
GOOG Google Weekly and Daily Charts Sideways Symmetrical and Descending Triangle Patterns
GOOG is a darling of traders recently. The last look at Google was to call the top in March due to the rising red wedge and negative divergence, which occurred. The behavior was mimicking AAPL's behavior when it topped and rolled over. Considering Google's push to be innovative, many traders have adopted it as the new favorite tech son. Price recovered to print new highs but the weekly chart shows that the move is running out of gas. The purple dots show the extension of the moving average ribbon with price above the 20 MA above the 50 above the 200. There is no where else to go on the upside so the price needs to reverse.
The daily chart shows a blue sideways symmetrical triangle in play and lets call the upside target at 920-940 and downside at 820-830 using a pivot at 880. Price appears to be sneaking out to the upside so the 920-ish target has to be respected in the short term. The red descending triangle is ominous since a failure at the 870 base line will target 820 below. The weekly chart has not yet printed a higher high, although it is in the neighborhood. The trade would be to simply wait to see if a nice short opportunity develops if the sideways triangle breaks out to the upside. A short would be entered say from 915 and higher. In the near term, there is no reason to be long in GOOG considering the weekly chart. There may be some additional upside but there is far more risk to the downside. So the idea would be to scale-out if long taking the profits and moving on while at the same time consider a short anywhere from here higher. If price creeps higher, watch the brown lines on the weekly chart to make sure the negative divergence remains in place to forecast downside. If not, price will want to move a bit sideways before rolling over to the downside. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.