Alphabet Inc. (NASDAQ:GOOG) buying opportunity
Across the board, once-loved tech stocks are dropping like flies. Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN), Netflix (NASDAQ:NFLX), Nvidia (NASDAQ:NVDA), and Google (NASDAQ:GOOG) are all in correction territory (10% or more off recent highs). Meanwhile, mid-cap-high-flyers like Shopify (NYSE:SHOP), Square (NYSE:SQ), Trade Desk (NASDAQ:TTD), Roku (NASDAQ:ROKU), Chegg (NYSE:CHGG) and iRobot (NASDAQ:IRBT) are all in bear market territory (20% or more off recent highs).
Long-term, recent weakness in tech is a buying opportunity. This is especially true for a few deeply undervalued tech stocks, like GOOG stock.
Near-term, though, the story is very different. The broader markets are a mess right now, with tech leading the decline. Everyone is concerned about a trade war breaking out and/or quantitative tightening killing economic growth globally. We are also, presumably, in the late-stages of a decade-long economic expansion, are due for a correction and are feeling the pressure of rising rates on equity valuations.
Overall, it is simply a bad market right now. In bad markets, stock-picking is tough. Almost everything goes down, with exception of defensive stocks with low multiples and big yields. GOOG stock isn’t a defensive stock. It doesn’t have a super low multiple, and there is no yield. Thus, buying the dip in GOOG stock or other tech stocks is tough to do at the current moment. It is very possible that we have further weakness ahead.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 1,154.72.
The projected upper bound is: 1,146.86.
The projected lower bound is: 1,050.00.
The projected closing price is: 1,098.43.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 21 white candles and 29 black candles for a net of 8 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
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 34.8876. This is not an overbought or oversold reading. The last signal was a buy 5 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 39.54. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 6 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 -52. This is not a topping or bottoming area. The last signal was a buy 4 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 sell 10 period(s) ago.
Rex Takasugi – TD Profile
ALPHABET INC C closed up 4.700 at 1,101.160. Volume was 1% above average (neutral) and Bollinger Bands were 65% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1,102.42 1,175.18 1,128.69
Volatility: 43 27 31
Volume: 1,868,048 1,517,990 1,676,364
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 is currently 2.4% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of GOOG.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on GOOG.O and have had this outlook for the last 10 periods.