Charting an End of August Key Support Level for Google GOOG

Aug 30, 2013: 9:54 AM CST

As August winds to a close, let’s take a quick look at a key chart-based support or inflection level for shares of Google (GOOG) both on a Daily and Weekly planning chart.

We’ll start with the Daily Chart which highlights the key inflection point best:

Google GOOG Chart Technical Analysis Trade Planning Key Support Level Fibonacci

After a “Cradle” Sell Trade into the cross-under of the 20/50 day EMA into $880 per share, Google shares have fallen to the next critical support or inflection target at the $845 per share level.

We’ll focus on this level due to the overlap of the March 2013 swing high with the 50% or “halfway” Fibonacci Retracement of the April to July rally phase.

Two other chart-based factors suggest a support bounce may occur – the slight positive momentum divergence and the test of the lower Bollinger Band.

For trade or strategy planning purposes, we’ll simply refer to this as a key inflection or focal point for price where the bullish or “support-bounce” thesis calls for a short-term bounce up off this level.

The alternate or “bearish breakdown” thesis calls for a quick short-sell or downswing to target the $825 confluence or the rising 200 day SMA.

We can see how this bearish thesis can play out – should it occur – on the Weekly Chart:

Google GOOG Weekly Chart Planning Technical Analysis Key Support Level

Again, we see the importance of the prior swing high level into $845 but note that price already broke and closed under the rising 20 week EMA at the $860 level.

Should sellers continue their aggressive movements, Google would extend its downside target toward the rising 50 week EMA and lower Bollinger Band confluence near $800 per share.

Just like we pieced together the puzzle for the Daily and Weekly S&P 500 chart earlier this week, be sure to integrate the Daily Chart potential support level but if it fails, it opens a pathway lower via the Weekly Chart “Open Air” breakdown.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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