Google (GOOG) Stock Chart

While some are disappointed in GOOG’s earnings announced yesterday, I think it is only opening an opportunity to get in.  As my friend who commented here a few weeks ago pointed out, he makes most of his “trading money” on GOOG options with a very limited amount of time spent in research.  He closed most of his positions before yesterday and only lost ~$750 after gaining over $10,000 the past few months on GOOG calls. 

I’ve been itching to get in to GOOG now that I’ve accepted buying calls into my trading model, but haven’t liked the chart in the past few months.  I missed out on a lot of gains by waiting, but also missed the big fall coming today.  I’m not in a sprint and have been waiting for a good pull back. That’s what we are starting to get.  The toughest question is always how far it will pull back.  Today it’s going to be like a falling knife and I won’t consider trying to catch it on a dead cat bounce.  Monday will be the first day after options expiration so there will be more non-standard behavior in the pricing.  If I can identify a spot where the chart matches the timing I’m might buy a call.

The chart is interesting on GOOG.  I circled the price from this morning.  How interesting that it opened right near its 50 day moving average which is also the high from November and January.  The other line I drew is also a curious one.  I used three previous short-term highs and threee recent lows to hit the same spot it’s trading today. These next few days will make it interesting for trying to determine the future direction.  After that, the line that’s currently at 480 would be a great one to follow and get in on if GOOG goes that low.

Click on the thumbnail below to view a full chart of GOOG.

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