Google’s Stock Tumbles Under $270, Our Pick Yields 17%
Last week we posted that Google was set for a fall under $300 a share and put a target price of $275 using simple technical analysis. In Live trading Google is sitting at $269, yielding a 17% profit in less than two weeks.
The big reason a trade like this works is because of the overall direction of the market, and that is down. Never fight the trend, and in this market any long positions even in the “big guns” like Apple or First Solar have just gotten killed.
We did not participate in our own Google pick. The reason is we decided back in August that the market was no place for up and coming financial bloggers. Lucky for us we have been over 90% cash since that day and have enjoyed a fairly peaceful last three months.
Let’s take a look at this chart of Google, and make sure to check out the original chart of Google as well to compare the two.
(New Investors – Read Stock Charts, Understanding the Basics and browse the technical analysis archives for further stock education.)
During the course of this fall the NASDAQ Composite fell a staggering 17%. This means we could have shorted nearly any stock and made a profit.
With discipline Google should be covered at this point for a 17% profit. Even though the lower lows signal it should continue to move down we have already succeeded. The market can take back what it gives out very quickly, so always stick with a very disciplined market strategy.
