Alphabet Inc. (NASDAQ:GOOG) – a $1trillion empire built on a simple idea
Google’s parent company Alphabet passed the $1trillion market cap mark last week, further cementing tech’s place at the top of the global business tree.
There are now four US tech companies that have reached a stock market value of $1trillion – Apple, Amazon and Microsoft all got there first – but in many ways Google is the purest example of the digital phenomenon.
Those other tech giants all have one foot firmly in the real world; as producers of hardware like the iPhone in the case of Apple; as a mammoth shop window and delivery network in the case of Amazon; or as the manufacturer of software and operating systems in the case of Microsoft.
Google derives its profits mainly from advertising – which is no new industry, of course – but its method for doing that is wholly dependent on the internet and leverages Google’s unique position as de facto curator of the internet itself.
It’s dominance now can be traced back to its beginnings. When co-founders Larry Page and Sergey Brin (who have announced they will now step back from the company) registered the Google.com domain name in 1997 the world looked very different. The largest US companies by market cap then were General Electric, Coca-Cola and Exxon – only the presence of Microsoft in the top four would hint at the revolution to come.
Google’s great innovation, based on Page and Brin’s work as Stanford PhD students, was to rank internet pages not on how those pages described themselves, but on the other pages that linked to them. Understanding this meant that the Google search engine could rank many more pages, with more relevance, than other search engines. From that idea, all else has flowed.
The new heights being reached by the tech companies helps to explain the overall record level of the US stock market right now. Any optimism that the stock market can rise significantly further from here depends in great part on this small handful of remarkable companies continuing to defy the normal laws of commercial gravity.
Unlike those index-leading companies of the past which depended on established markets that could not suddenly expand, the tech giants have proved adept at finding new markets to disrupt and dominate. Just when you think they may have reached saturation point, along comes a new world to conquer.
Even at $1trillion size, analysts are writing new higher target prices for Google – and some have predicted that the £2trillion is milestone will be around the corner before too long.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 1,352.72.
The projected upper bound is: 1,519.52.
The projected lower bound is: 1,448.80.
The projected closing price is: 1,484.16.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 5 rising windows in the last 50 candles–this makes the current rising window even more bullish.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 96.8488. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 15 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 80.79. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 21 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 130.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 2 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 9 period(s) ago.
Rex Takasugi – TD Profile
ALPHABET INC C closed up 28.690 at 1,480.390. Volume was 80% above average (neutral) and Bollinger Bands were 102% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1,428.28 1,347.95 1,222.17
Volatility: 16 17 29
Volume: 1,616,477 1,337,788 1,409,847
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
ALPHABET INC C gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
ALPHABET INC C is currently 21.1% above its 200-period moving average and is in an upward trend. Volatility is Our volume indicators reflect volume flowing into and out of GOOG.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on GOOG.O and have had this outlook for the last 28 periods. Our momentum oscillator is currently indicating that GOOG.O is currently in an overbought condition.
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