Google hit with third lawsuit! Buy dip at trend line support?

By Admiral Markets

Shares in Google’s parent company Alphabet have been in full focus as they received a third government antitrust lawsuit in less than two months. Thirty eight states in the United States have joined forces to claim Google maintained a monopoly in general search and search advertising illegally through anti-competitive contracts.

The move is likely to influence investors buying when the stock price is at record highs. In fact, the technical chart looks relatively bullish as the price struggles to break through the 1.272 Fibonacci extension level taken from the 2 September swing high to 23 September swing low, as shown below:

Source: Admiral Markets MetaTrader 5, #GOOG, Daily – Data range: from Jul 16, 2020, to Dec 17, 2020, performed on Dec 17, 2020, at 9:30 pm GMT. Please note: Past performance is not a reliable indicator of future results. 

Last five-year performance: 2019 = +28.18%, 2018 = -0.80%, 2017 = +32.93%, 2016 = +1.86%, 2015 = +46.61%.

Fibonacci extension levels are used to help identify potential turning points in the market. At the level highlighted above, the price has also failed to make a higher and has formed a double top fake out chart pattern around the 1,810.17 level.

The price may pull back towards the ascending trend line support level as highlighted by the thick blue line, after all, many investors may think twice about buying a company trading at record highs with three antitrust lawsuits to deal with.

If the price can pull back towards the trend line support it may be an area investors may consider to turn up once more.

According to BarChart, bullish ratings from analysts have peaked:

Source: BarChart, December 17, 2020

Did you know that you can use the Trading Central Technical Ideas Lookup indicator to find actionable trading ideas on thousands of instruments across Forex, stocks, indices, commodities and more?

You can get this indicator completely FREE by upgrading your MetaTrader 5 trading platform provided by Admiral Markets UK Ltd to the exclusive Admiral Markets Supreme Edition! You’ll also receive a whole range of advanced trading tools such as correlation and sentiment indicators!

Start your free download by clicking on the banner below:

INFORMATION ABOUT ANALYTICAL MATERIALS:

The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the website of Admiral Markets. Before making any investment decisions please pay close attention to the following:

1.This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

2.Any investment decision is made by each client alone whereas Admiral Markets UK Ltd (Admiral Markets) shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.

3.With view to protecting the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.

4.The Analysis is prepared by an independent analyst Jitan Solanki, Freelance Contributor (hereinafter “Author”) based on personal estimations.

5.Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis.

6.Any kind of past or modelled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.

7.Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.

By Admiral Markets