Saturday, January 14, 2017

GOOGL Alphabet (Google) Monthly Chart; Overbot; Rising Wedges; Negative Divergence

GOOGL has rallied ever since the easy money joy ride began with former Fed Chair Bernanke pumping the stock market higher starting March 2009. GOOGL has had quite run.

Price has come up for a matching high compared to a few months ago and the indicators are universally negatively diverged. GOOGL is likely in the process of printing a multi-year top. Do not get caught up in the hype.

Price has violated the upper band so the middle band at 738 is in play and the lower band at 598. The bands are pinching in so price will likely top out in this 830-880 range. Price is extended above the moving averages and needs a mean reversion lower. Price is overbot and the indicators display universal neggie d. The red rising wedge is ominous and the blue rising wedge is doubly ominous.

The pink box shows how the upper trend in price is a strong trend higher starting 2013 but is now running out of gas and the ADX is not as high as 3 years ago when price was far lower. If the ADX drops to 35, 30 and lower, GOOGL is toast.

You do not want to own this stock. If long, it is likely prudent to scale out going forward and just let that money sit to the side in cash. The upper band at 877 is on the table but will likely not make it to that level. With price at 831, it is likely that the multi-year top is printing right now. There may be a jog move, down now, up in February, then roll over and down in March from the apex of that red triangle, however, this chart is so sad looking the expectation is that Google begins a long multi-year track lower from these levels at anytime. 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.

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