GOOG Google Daily Chart H&S Downward Channel Gap Fills

GOOG Google daily chart ahead of tomorrow's earnings release. The red lines show the negative divergence smack down that was forecasted to start the year. An H&S is in play now with shoulders at the 630 level, a head at 645, and neck line at 550-ish, which then targets the horizontal support area of 440-460 as a potential target area. Making the bear case for the stock, the downward channel is producing lower lows and lower highs, a gap fill is needed below at 567, the 20 MA is under the 50 MA, price has not been able to get back above the 20 MA, price is at the top rail of the downward channel ready to receive another spank down and the RSI and stochastics are below the 50% levels. In addition, when the neck line was tested in March and the bounce occurred the RSI was not happy about it, RSI wanted to see lower numbers.

Making the bull case, two gap fills are needed above, one at 586 and one at 625 (a firm ceiling for GOOG), but these fills can occur at any time in the future. The 20 MA is trying to curl back up to recover and the volume has increased slightly during the six week pull back recently, but, other than that, the bull case is thin.

Looking at the sideways preference of the RSI right now, a sideways range between 555 and 595 is very much in play but if you had to pick sides it would be down from here. Downside targets would include 570, 565, the neck line at 552-557, and if that fails, Google is in big trouble. An upside target would be the gap fill at 587 but overall, there is no reason to be involved with this stock.This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here or any links connected to this information. Consult your finanical advisor before making any investment decision.