Google's ( NASDAQ:GOOG ) stock chart offers a wealth of knowledge for both new and seasoned investors. By applying simple technical analysis traders can view key buy and sell signals, resulting in smarter and more profitable investment decisions.
The big advantage to technical analysis is the ability to apply its lessons today and anytime in the future. Professional investors such as Dan Zanger have mastered the basics and as a result are multi millionaires today.
Take a look at the following stock chart of Google ( NASDAQ:GOOG ) and then read through the numbered points for an added explanation.
1. The purple 1 is a descending channel identified in a previous post of Google.
2. The blue 2 is where Google gapped through $475 resistance and opened above $525 a share in mid April. This was earnings related.
3. The blue 3 was a small bull flag with $560 as resistance. Google ran to $600 in three days following the break, peaking at $602.45.
4. The blue 4 shows how a series of lower highs formed over several months. $540 support held through this time period until point 5 where bears to back control of the stock.
5. The blue 5 identifies when Google broke below its key $540 support. The stock tried to rally and made it back above $550 but quickly fell back below. This ultimately lead to lower prices below $520.
6. The blue 6 shows how once Google had fallen through $500 this price level became heavy resistance. A rally in mid August quickly ran out of juice which lead to lower prices once again.
7. The blue 7 shows key support line at $465 which could not hold up when being tested for the third time.
8. The blue 8 identifies the latest ascending channel that was formed in September and lead to lower price back below $425. Ascending channels are a common bearish pattern seen in downtrends and almost always result in lower prices.
---> Next Chart, General Motors (GM)
Navigation
- Example 15, 9 Lessons to Learn Regardless of a General Motors Bankruptcy
- Example 14, Google (GOOG) <–- Currently Viewing
- Example 13, 7 Great Lessons to Learn From Apple in the Last Year
- Example 12, A Technical Look at the Washington Mutual Brankruptcy
- Example 11, Support and Resistance Example, Lehman Brothers Brankruptcy
Make $42 Million Trading Stocks! Learn technical analysis with Dan Zanger, World Record Holder who turned $15,000 into $42 million. Click here to learn how.
Nice chart Blain, I remember you posting the first one with the symmetrical triangle. You keep teaching me more and more, thank you!
Taking a different look at the chart Blain there are 5 bear flags (ascending channels) that can be seen.
The breakdown at point 5 was also the third selloff into support, very similar to point 7.
agree with matt. due to your blog I become more self-assured in my knowledge. you are a great teacher and your explanation have no comparison
ahhh goog - brings back some memories. I actually bought at point #2, sold somewhere near point #4 for a gain. Bought again near point #6 and sold before point #7 for a loss.
Another well done chart to reconstruct the trade. Can't stree the importance of this exercise.
Good trading (pssst stay in cash)
Blain after today you should update your chart, another breakdown.
Regardless Stock Speculator says it best, cash is king.
Another breakdown would be awesome Blain!
high yield savings FTW!