GOOG - Long or Short......?!

[stockdaily]

It is very risky at $400. Expectation is too high.

 

[tradesmart]

another TT........

It is very risky at $400. Expectation is too high.

Well Stockdaily, that’s what I thought, but the bulls are still kicking and every time GOOG touches the $400 mark, buyers (or someone) appear to nudge it to the upside….there was a nice $10 move in it from yesterday….!

It reminds me of the ‘Tropical Trading’ story in ‘Reminiscences of a Stock Operator’ – (a stock where the price was ‘held up’ by a Wall Street clique despite overwhelming short interest..)

Anyway, there’s still a huge $40 triangle in play, with a slightly different definition to the previous chart, so I’m still watching for a clean break to determine the next trending move..

 

[boy]

Well Stockdaily, that’s what I thought, but the bulls are still kicking and every time GOOG touches the $400 mark, buyers (or someone) appear to nudge it to the upside….there was a nice $10 move in it from yesterday….!

It reminds me of the ‘Tropical Trading’ story in ‘Reminiscences of a Stock Operator’ – (a stock where the price was ‘held up’ by a Wall Street clique despite overwhelming short interest..)

Anyway, there’s still a huge $40 triangle in play, with a slightly different definition to the previous chart, so I’m still watching for a clean break to determine the next trending move..

08:17 GOOG Google target raised to $490 at Citigroup (410.65 )

Citigroup raises their tgt on GOOG to $490 from $430, and raises their Q4 ests. Firm believes the stock will continue to increase, saying GOOG remains the clear leader in search innovation, and GOOG's product development could allow it to materially gain share in large Net ad segments, where it has had limited presence to date.

Houston - we have lift off......

 

[tradesmart]

posted above by boy:-
Houston - we have lift off......

I'm sure that there are many GOOG investors hoping that you are right boy, and the continual revision of price targets up to the magic $500 may act like a magnet......

We haven't got a clean break away from the $40 triangle yet and $430ish remains as resistance; but the $40 triangle height / $410 breakpoint suggests that $450 may be in the sights.....

However, an unexpected trip south breaking current support at $400 will be a gift to the bears...

 

[tradesmart]

Posted above:-
the $40 triangle height / $410 breakpoint suggests that $450 may be in the sights.....

Close enough maybe - $445 hit today followed by a sharp $25 reversal….

Have the big boyz decided that’s all for now and we’ll see $300 again before we see $500…..?

The next move will be interesting….

 

[tradesmart]

Another consolidation - another triangle.

And another '"trade the break" job imho, but my call is bearish with a $395 target....

Let's see what gives......

 

[cwang]

where is it going if it breaks up instead?

Another consolidation - another triangle.

And another '"trade the break" job imho, but my call is bearish with a $395 target....

Let's see what gives......

Should it be 455?

There might be a good entry point for a trade this Friday

 

[tradesmart]

Cwang:-
Should it be 455?

There might be a good entry point for a trade this Friday

Well, I think that the “good entry point” for a long came today, with the trend line break and RSI/CCI showing support….

(seasonality factors confounding bearish thoughts; the rising market tide is lifting most 'boats' - even those that are as high on the water as GOOG......... )

$455 could well be in the sights.....!

 

[cwang]

Thanks for all the chart analysis for goog. it was impossible to look away and not to scalp some fruits off google. I haven been trading google alone for half a year until I found your thread yesterday. wish have found it much earlier. Was able to scalp $3 movements all the time, but tired as hell to make those chump change. (after paying for all the commission and tickspread between bid/offer) Now I am thinking about catch some $10+ movements

Just wondering about your signature. shouldn't we wait for market to confirm our opinion before we enter a position? otherwise how do you know if a resistance test will succeed or fail? maybe you really "feel" the market like some of my co-workers at work suggest? every time i try to feel the market, i feel bad for some reason

 

[tradesmart]

Cwang:-
shouldn't we wait for market to confirm our opinion before we enter a position? otherwise how do you know if a resistance test will succeed or fail?

Well, Cwang, this is what every trader is waiting for, confirmation to buy or sell…!

I don’t know what parameters you trade by, but to use the example of the $40 triangle that occurred recently; if you’d traded the trend line break at around $408 and just let it go, you could’ve captured a $35+ run in 10days if you had confidence that the $40ish target would be just about reached, and you didn’t lose too many $$’s in the swift reversal off of $445….!

Now we have a $25 triangle that looked bearish, but is apparently breaking to the upside…..if you’d entered long at the trendline break at $428 yesterday, you’d be a couple of dollars up today in the pre-holiday sideways price action.

Can you ‘sit on your hands’ and hope that the potential $455ish target is reached, or will it prove to be a false breakout and collapse south from, say, $435 to test $400 again, taking some of your cash with it unless you’ve got a breakeven stop in….?

There are no easy answers to these dilemmas imho – every trader has a different tolerance to risk and reward……

But if you’re regularly taking $3 runs, that’s pretty good and reminds me of the saying “no one ever went skint making a profit…!” :cheesy:

Good Luck and Merry Christmas…..

ps By the time the market 'confirms' what you suspected, it is TOO LATE. By the time the market passes or fails a 'test', it is too late. To be paid, you must act upon your suspicions before they are manifested.

 

[cwang]

Merry Christmas!

Now this is an interesting time again, between Christmas and new year.

I make longer term trade decisions base on daily candle and Elliot wave on daily bar. Daytrade decision based on elliot wave on 5 min bar. and look at some other indicators at the same time. Never used triangle before, so I was still learning from your post.

From an elliot wave stand point, the long term pattern and short term pattern are the same pattern now (which is usually a good sign for a trade) but I don't under stand this pattern.

Start with daily bar, If you look at the daily bar between end of October(where the gap is) and now. you see a pattern that's almost wave 1-5, except there is a bump right after wave 4 (beginning of Dec).

Now look at the 5-min bar for the three days dec21-dec23). it's the same pattern, but it's not elliot wave. that would be interesting to study.

After I saw a bump on the daily bar, I have only been day trading since then. never left anything over night. (I don't do what i don't understand until i understand it )


the $3 long was based on elliot waves, doesn't always win, lost last friday, for example. after everage up all the trades, it's a little profit.

 

[cwang]

Elliot wave

Ok, here is my take.
1. Elliot Wave
Now i believe google daily bar did form an elliot wave. Average major wave length being 10 daily candles.

The first correction wave happened 6 trading days ago, where the first red candle is. We have roughly 4 more trading days to go to attempt to break the 420 support line. if 420 is broken, we will see a pull back above 420 again for 3 trading days.

the final correction wave, where all the bears should be waiting for, will happen 7 trading days from today. where be heading toward 400. we should be expecting the final wave to occur in the period of Jan 10th - Jan23rd

This theory closely matches with tradesmart's triangle theory, i believe

2. recent candles

in the last 7 trading days, engulfing bear candle twice, hanging man twice, but support line of 420 was tested twice and didn't break through. I don't recommend to trade if the final correction wave cannot break 420, as the resistance seem to be very strong at 420. say, I would enter a short at 415, but not 425.

if google cannot break 420 in next 4 days, we may not see it till final wave, so I am going to las vegas and come back jan 10th to look at the trades again.

 

[cwang]

Dec 29 2005

Ok, today goog went through 420 support line quickly during the last hour. However, I would be cautious about taking last hour into account.

If we are not around New Year, tomorrow I would go short for 3 days if google stay lower than 420 in the morning for 20 mins. However, google seems to always get this kind of luck, as the first correction wave is happening during a major holiday time. I cannot figure out how holiday will affect this correction wave. (i'll place a super small position tomorrow to see what happens, it's just easier to learn with a position )

I made a loss this morning. when I saw the 4th 5-min bar bounced back from the 425 line, I placed a long at 425.5, then 13th bar broke through 425, so I exit 424.5. Looks like I need to redefine what's the pivot point for day-trading long. My theory on short point stays at 415, as I mentioned from last post, and it's a short-term short instead of day-trading short.

 

[tradesmart]

Well cwang, I’m beginning to suspect that the “short-term short instead of day-trading short” could become a much longer term short for those who have the patience…

The triangle mentioned previously has developed and now the bearish sub-$400 target could be in the sights…....

And we have a rare item of negative GOOG news today……!

GOOG is reportedly being sued by a New York based firm over the patents it's alleged to use for Voice-over-IP technology in Google Talk. Rates Technology Inc. is seeking $5 billion in damages, the report in The New York Post said.

Also the daily chart hints at the possibility of a significant trendline break to the downside…

Let’s see if the bulls can prop it up now…….

ps - even Jim Cramer is having his doubts....

Google Now Looks Set to Stall By James Cramer
I'll declare victory on my $450 price target with Google's $446. Google can't advance without another quarter under its belt. I am not a bear on Google, but I believe Yahoo! will now catch up.

 

[cwang]

12 30 2005

Well cwang, I’m beginning to suspect that the “short-term short instead of day-trading short” could become a much longer term short for those who have the patience…

I trade options and options were not so patient they go down in value daily unless we are beefy enough to go for way-out-of-money contracts. It may not be a bad idea to do an all-or-nothing trade once a while if we are certain we are correct.

Like the plan i posted yesterday, this morning goog stayed under 420 for 20 mins. I bought one contract of Goog Jan 410 Put at 7.50. planning to make $500 from this one tiny contract if our theory is correct

I will enter more positions next week if goog goes the correct direction, until risk-per-trade is hit.

Speaking of the lawsuit, i think it will simply increase volatility. People may be holding breath till the point where result of the law suit is somewhat obvious. I think the short term effect is already cashed in for 10 bucks drop.

Let's keep looking at google everyday. This is a very good one to study. It feels a lot like ERTS a few years back.

 

[goog]

well well well
it has broken the 420 level!
charts are looking interesting!

Ok, here is my take.
1. Elliot Wave
Now i believe google daily bar did form an elliot wave. Average major wave length being 10 daily candles.

The first correction wave happened 6 trading days ago, where the first red candle is. We have roughly 4 more trading days to go to attempt to break the 420 support line. if 420 is broken, we will see a pull back above 420 again for 3 trading days.

the final correction wave, where all the bears should be waiting for, will happen 7 trading days from today. where be heading toward 400. we should be expecting the final wave to occur in the period of Jan 10th - Jan23rd

This theory closely matches with tradesmart's triangle theory, i believe

2. recent candles

in the last 7 trading days, engulfing bear candle twice, hanging man twice, but support line of 420 was tested twice and didn't break through. I don't recommend to trade if the final correction wave cannot break 420, as the resistance seem to be very strong at 420. say, I would enter a short at 415, but not 425.

if google cannot break 420 in next 4 days, we may not see it till final wave, so I am going to las vegas and come back jan 10th to look at the trades again.

 

[goog]

u may want to look at writing options!
i have been selling puts all the way.

Now I m looking to be selling calls. Currently have sold the 460 calls
looking to sell puts out of money, once it goes down a bit more.

yes they say this is risky, but with good planning strategy, this cud be the most profitable

I trade options and options were not so patient they go down in value daily unless we are beefy enough to go for way-out-of-money contracts. It may not be a bad idea to do an all-or-nothing trade once a while if we are certain we are correct.

.

 

[cwang]

u may want to look at writing options!
i have been selling puts all the way.

Now I m looking to be selling calls. Currently have sold the 460 calls
looking to sell puts out of money, once it goes down a bit more.

yes they say this is risky, but with good planning strategy, this cud be the most profitable

Hmm, i think i would consider doing something like sell 440 call and buy 460 call, but just sell 460 call naked is not the cup of tea i want to take yet. In the first case, we have a calculatable risk, in the second case we don't. you cannot stop people from suddenly taking lots of pot during new year eve then put all their money in buying google two days later.

are you also focusing everything on google now since you are using goog as your user name ? I hope google doesn't split so we option traders can enjoy this cheap commission fee.

 

[Bono]

Now Goog is at $417 are we in for a major correction? some think by as much as $100!
Whats the verdict??

 

[cwang]

Now Goog is at $417 are we in for a major correction? some think by as much as $100!
Whats the verdict??

Goog is at 414.86 without counting AH. If you look at a few more posts above, we believe the chart pattern is suggesting a correction. When you say "Some Think by as much as $100", does it has something to support this statement?