Google — buy, sell or hold? (November 03, 2012)
GOOG
I’m Dan Fitzpatrick at StockMarketMentor.com on Saturday, November 3rd, the day before my older brothers birthday. I want to take a quick look at Google ( $GOOG Google Inc ). I’m here in Houston, about to speak at the “Invest Like a Monster” conference, but I want to get this out first, if possible. So look, with Google ( $GOOG Google Inc ), a couple of things, support, very, very critical support here, right about $670.00, that’s pretty clear. This was a volatility squeeze though and it blew out to the downside, okay, so there’s a lot; look at the volume here, big, big volume on these two days, big volume, downtrend, I guess you could say that’s a downtrend. So this was a big sell-off, institution sell, this is not a bunch of retail sellers selling their nine shares, this is big intuitional selling. So we look at the Weekly Chart though and say, Wow! This has been in a base, a high base for two years, so it’s finally coming back to test this base, the prior resistance here at the base. This actually looks like a buyable dip. The thing that’s kind of bothersome to me is this is really steep, I mean this is a really steep pullback. Again, intuitional selling, we’ve seen these steep pullbacks before, this one here, but then look at what happened here, this steep pullback. Well, this is in congestion, so the stock didn’t have that much potential anyway it’s in congestion. Here though the steep pullback was after a big move up, kind of like this big move up out of a volatility squeeze. So right now I’m looking at this and I’m saying, okay, about $660.00 would be what I would determine to be support, we’ll call it $650.00, about $650.00 okay. So that’s $37.00 lower than this price is now. I view that as your risk in buying right now. I think any kind of weakness in the market, you know the election, the market’s either going to move one way or the other and It’s going to move big, so will Google ( $GOOG Google Inc ). If it holds above this level a couple more days then you probably take this stock to the long side. However, if it breaks down below $670.00 you really need to get out. If you’re taking a loss because you decided well you’re going to take this dip or maybe you were that poor, hapless soul who bought right up here at the top, you need to take your losses, get out, because the thing about this is you can always buy it back, you can always buy it back; but one thing you can’t do when a trade is really, really going against you, you can’t sell it for yesterdays price or last weeks price; that’s why it’s a loss in the first place, so keep that in mind, you can always buy a stock back, maybe not at as a favorable of price but you can it back. But when you’re taking it on the chin by a stock that you own, that’s going the wrong way that hurts a lot worse, so don’t go there. Okay members, got the Week End Update for you and we’re talking about three specific sectors that are working. Free Chart