The first chart, as you might have guessed is the disaster du jour, Google, down 5% on an earnings miss. Since Google does not provide any guidance, the lucky analysts who follow the phenom company have to actually do some research and come up with an estimate. Collectively, they have not done a brilliant job this quarter, but hey, that's the way it should be. It certainly is an improvement over the "beat the number" game that some companies still play wherein meaningless, manufactured earnings beat the guidance (fed whole to the analysts) by one penny....every quarter. But I digress. There's not much to say about the first chart, technically, except that the fall was seemingly held in check (no way to know for how long) by the 50-day moving average which is around 510 these days. Much more intriguing is the second chart, the relative chart of Google to the S&P 500 (it's GOOG divided by SPY to be precise) and it's interesting to note that, for the third time, resistance at 3.6 (the number does not really matter, I'm mentioning it for reference) came into play. Could it be that resistance levels do mean something in relative strength charts or is it pure coincidence? You decide.
4 comments:
I don't own GOOG and haven't since I made a "killing" from buying at $110 and selling at $114. (Doh!)
But you know, they are taking over the world. Without boots on the ground.
Now, maybe earnings growth is an issue and maybe the whole business model of "click ads" is suspect. But The Google is the net. Risky investment? Maybe...
Good blog.
Thanks, muckdog, much appreciated.
Great observations. Amazing how perfectly the RS line bounce off the resistance line...I had the same bearish analysis a little while back. Negative momentum divegences in the weekly charts should make the long-term interesting as well.
I'm not familiar with the fundamental side of Google, but WSJ has an interesting article recently about how the company is facing problems retaining top talent now that they are so large. Apparently many are leaving once their options vest and moving to smaller start ups where they can have more of an impact.
Nice blog
JB
http://dormroomtechnicals.blogspot.com/
Thanks jbetz. Your blog is pretty cool too.
As for Google, I'm still willing to give them a pass on this miss, technically and fundamentally...for now.
From what I hear, the cool place to be employed at right now is Facebook.
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