rtmark
LearnBonds.com

Alphabet Inc (NASDAQ:GOOG) Stock Chart Paints Bearish ‘Pin Bar’

Alphabet Inc

Alphabet Inc stock has been stuck in a narrow price range since the past few trading sessions. Such consolidation often precedes a break out in either direction. The job of any trader or investor should be to search for clues as to the direction of that impending price move.

The appearance of a bearish “pin bar” on the daily chart suggests Alphabet may be ripe for a correction after bouncing close to 10 percent from the lows of last month.

Alphabet IncAlphabet Inc Stock Showing Signs of Exhaustion

The “pin bar” on Alphabet Inc’s daily chart is indicative of bulls finally running out of steam. The pattern is extremely powerful, and has high predictive value when identified correctly. A pin bar is short for Pinocchio bar. It consists of a small real body and a long wick protruding from the body. In case of the bearish variation, the body is at or close to the low of the session, with the wick at least 3 times the size of the real body.

The significance of the latest pin bar is further enhanced by the fact that it appeared around the key resistance zone of $750. For pin-pointing entry, traders can switch to 5 minute or 15 minute charts, and go short on the break of a lower pivot low. Stop loss can be placed above the last pivot high.

Alphabet Inc Chart Points to Weakness – Top Trader

“I think Alphabet has reached overbought conditions and it’s set to move lower into earnings next month,” Todd Gordon, founder of TradingAnalysis.com, told CNBC.

Looking at the daily price chart of Alphabet Inc , Gordon notes that the formation of a “textbook” setup indicates a retracement is round the corner.

“What we had was a rally, then a step back into a higher low,” he explains. “But the key indicator that we are in a corrective rally is we got another push that was exactly the distance of the prior rally and that failed…I think the downtrend is going to resume.”

To profit from the expected decline in Alphabet Inc, Gordon suggests buying a put spread – specifically the April 730/725 spread. In this bearish options strategy, an investor buys a put and then sells a lower strike price put of the same expiry to offset the cost of initiating the trade. The target is for the underlying shares to dip to the short strike, or in this case to $725 by the middle of next month.

Shares of Alphabet Inc  ended Wednesday at $750.53.

Trusted & Regulated Stock & CFD Brokers

What we like

  • 0% Fees on Stocks
  • 5000+ Stocks, ETFs and other Markets
  • Accepts Paypal Deposits

Min Deposit

$200

Charge per Trade

Zero Commission

Rating

64 traders signed up today

Visit Now

75% of investors lose money when trading CFDs.

Available Assets

  • Total Number of Stocks & Shares5000+
  • US Stocks
  • German Stocks
  • UK Stocks
  • European
  • ETF Stocks
  • IPO
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 Zero Commission
  • NASDAQ Zero Commission
  • DAX Zero Commission
  • Facebook Zero Commission
  • Alphabet Zero Commission
  • Tesla Zero Commission
  • Apple Zero Commission
  • Microsoft Zero Commission

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
  • Paypall
  • Skrill
  • Neteller

What we like

  • Sign up today and get $5 free
  • Fractals Available
  • Paypal Available

Min Deposit

$0

Charge per Trade

$1 to $9 PCM

Rating

Visit Now

Investing in financial markets carries risk, you have the potential to lose your total investment.

Available Assets

  • Total Number of Shares999
  • US Stocks
  • German Stocks
  • UK Stocks
  • European Stocks
  • EFTs
  • IPOs
  • Funds
  • Bonds
  • Options
  • Futures
  • CFDs
  • Crypto

Charge per Trade

  • FTSE 100 $1 - $9 per month
  • NASDAQ $1 - $9 per month
  • DAX $1 - $9 per month
  • Facebook $1 - $9 per month
  • Alphabet $1 - $9 per month
  • Telsa $1 - $9 per month
  • Apple $1 - $9 per month
  • Microsoft $1 - $9 per month

Deposit Method

  • Wire Transfer
  • Credit Cards
  • Bank Account
All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
Avatar