Alphabet Inc. (NASDAQ:GOOG) remains extremely robust and growth will continue to come from multiple fronts

Alphabet Inc. (NASDAQ:GOOG) remains extremely robust and growth will continue to come from multiple fronts

Alphabet Inc. (NASDAQ:GOOG) remains extremely robust and growth will continue to come from multiple fronts

Alphabet’s results disappointed Wall Street, although revenue and earnings were both ahead of our estimates. What’s more, revenue grew 16.7% off a $30 billion base, which is huge by any standards. Regardless, the shares were battered afterward.

Google property ad revenue grew 16.7%, network property ad revenue grew 8.5%, other revenue (including cloud, Play and hardware) grew 25.1%. APAC grew 31% at constant currency, followed by other Americas 21%, U.S. 19% and EMEA 16%.

Breaking from the tradition, cost per clicks actually grew 5% with a 9% decline in paid clicks. Impressions grew just 5% despite a 14% decline in cost per impression. These are the metrics that may have thrown investors. The company’s attempts to clear up fake and harmful content on YouTube (sounding somewhat like Twitter-style censorship) likely impacted its results. But it could ease regulatory issues in some countries.

The $1.7 billion EU fine that Google will no doubt challenge was charged in the quarter.

The business remains extremely robust and growth will continue to come from multiple fronts because all the major Google services have a billion+ users. Amazon doesn’t appear to have had much of an impact on ad revenue yet and Google is in any case much bigger than the shopping ads it sells. Prospects for the Other Bets segment are bright with drone-based deliveries and self-driving cars slated to join Verily (the healthcare business) soon.

Look for increasing investments to drive long-term shareholder value.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1,246.30.

The projected lower bound is: 1,135.64.

The projected closing price is: 1,190.97.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 23.6317. This is not an overbought or oversold reading. The last signal was a buy 0 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 44.85. 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 sell 4 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 -84. This is not a topping or bottoming area. The last signal was a buy 0 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 4 period(s) ago.

Rex Takasugi – TD Profile

ALPHABET INC C closed up 3.990 at 1,189.390. Volume was 5% above average (neutral) and Bollinger Bands were 43% wider than normal.

Open High Low Close Volume___
1,166.2601,190.8501,166.2601,189.390 1,563,943

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 1,223.77 1,193.60 1,139.57
Volatility: 52 29 34
Volume: 2,152,624 1,460,963 1,645,532

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.

Summary

ALPHABET INC C is currently 4.4% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 2 periods.

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