I shocked the hell out of Duru when I sent him an SMS earlier this evening telling him that I was going to buy some Google in my IRA tomorrow. His immediate response to me was "but it's below the 50-day moving average!" -- as if that technical mumbo jumbo means anything to me! ;-)
But seriously, my reason for wanting to own some GOOG aren't based on the technicals. I've been seriously impressed by Google's business model ever since I signed up for AdSense two years ago. I still don't know what I was smoking that caused me to not pull the trigger back when I saw the stock bounce off of 100 and then again when it made that first all-time high back in the 110s. So, yes, this is more of a fundamental play than a technical one. I'll still have a stop loss in place and although the technical picture isn't pretty right now I'm not overly concerned. (famous last words! -gulp- )
Having said that, there are some TA points that I can use to rationalize but purchase. Today the stock bounced off of the support around $275. The long-term MMAs are still bullish and the stock closed just a hair under the slowest of the moving averages (60 EMA). It also bounced off of its lower Bollinger Band, which appears to be turning higher. And finally, the stock is still above its 200-day moving average, which is the time-frame that I'm concerned about in my IRA.
P.S. Cramer's $630 and $800 valuations on Google tonight on Mad Money had nothing to do with my decision to jump in now. Nor does it have anything to do with this Wall Street Journal article -- Google as -- Get This -- Value Play! - Despite the IPO's Skyrocket, Some See Further Potential In Company's Business Model
I will officially express my shock in print. All you TraderMike fans need to mark this day in your calendars! Isn't that a breakdown from a subtle H&S break that I see? Didn't GOOG just gap down on high volume? Heck, wasn't that an evening star at the very tippy top back in July? And Mike wants to talk fundies now?!? Go 'head man! You're bringing a tear to my right eye. Buy what you know! =smiles=
Fortune had an interesting article on Google's pulling engineers away from MSFT..
http://www.fortune.com/fortune/technology/articles/0,15114,1050065-1,00.html
(comfort is the enemy of progress... has MSFT become 'comfortable' ?)
UnixReview also noted recently that in Bell Labs closing down dept 1127 (the dept of the group that originally brought us Unix) two members of that dept are now at Google.
http://www.unixreview.com/documents/s=9846/ur0508l/ur0508l.html
Google's definately amassing some top talent. The question is what can they do with it.
There's a huge OS / office tool market out there with great margins and MST owns it, but Google's market cap is already 1/4 of MSFT and it rained yesterday. What does this mean ? Beats me.
Best Wishes,
- MikeB
Thanks for the articles Mike.
I'm short GOOG from $290. If it starts to go into the loss column for me then I'll cover.
I will say this, GOOG's current chart is the kind you can bet either way on as long as you stop your loss quickly.
The markets seem to be rolling over on a longer term basis...Probably not a good time to buy anything long or even intermidiate term...The market landscape should look far different 2 months down the road...the way I see it anyway...