A Gap Out and Breakdown for Google GOOGL

Jun 17, 2016: 1:58 PM CST

Google (GOOGL) shares broke to new swing lows today after a gap-down and strong sell-swing.

Price broke through a rising trendline and triangle pattern, triggering additional selling pressure.

Here’s the intraday breakdown and structure – we’ll also put this in context on the Daily Chart:

Price fell shy of the $800 per share high in April and plunged $100 lower to bounce twice through May.

As we’ll see on the Daily Chart, a “Bear Flag” or rising parallel trendline developed along with a Symmetrical Triangle (yellow highlight).

Price broke under both of these patterns and sprung free of the consolidation, triggering a wave of selling.

Here’s the Daily Chart and larger structure for Google (GOOGL) share prices:

The $800 per share level served as major resistance and buyers haven’t been able to boost price above it.

A sharp collapse in February plunged price under $700, and sellers took control also in April with a similar $100 point drop.

Our little “flag” or rising parallel trendline (blue) developed and sellers overpowered buyers this week to force a breakdown.

Stop-losses are being triggered as price collapses back toward $700.

If you’re trading Google here, focus on the simple $700 level and how rallies have developed there.

If instead we see shares under $700 and $690 into next week, we could be on the cusp of additional downside pressure.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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1 Comment

One Response to “A Gap Out and Breakdown for Google GOOGL”

  1. Fancy Says:

    There seems to be strong trend, so it will be sensible only to ride it instead of going against it which will create unnecessary trouble for us. I am currently trading with OctaFX broker and there I always ride trend, it’s easier to do through their amazing daily market news and analysis service, it’s ever easy and straight forward to follow yet highly effective as well, so that’s why I like it so much and always brings out the best for me.