Nevertheless, I’m pessimistic that Google can stay above $500 per share for long. So, shall I short this guy since the resistance of $505 is very strong? You make your own decision and research before jumping into the boat. There’re many ways to skin a cat – Google is a good example of a stock which has volatility for you to make money in whatever way you like, and I’m using just the simple Support-Resistance technical analysis.
If you have position in Google Inc. (Nasdaq: GOOG, stock) especially if you long on this stock, you should feel the excitement as me today. The stock broke the $ 500 per share resistance again with colorful trend. And as usual I took profit and run before it comes down again because the $500 level is a very strong resistance which this giant has been trying to establish late last year, 2006.
This position was actually opened on Apr-19, 2007 just before the earning announcement. To refresh my readers, I long the position with GOOG June $470 Call Option after my analysis here at YAHOO’s Loss is GOOGLE’s Gain -Time to Make Money. And it sure did beat earning and reward me with a whopping $19 per share gap the next day. I’ve blogged earlier that I did not plan to close the position even though it was in profitable position as I need to see if it actually can establish a new $482 support level (read it here at MoneyMaking Machine GOOGLE – Did You Make the Money). Most importantly I wanted to see if it can break the $500 level.
If you look at the chart, the stock did hovering at the support of $475 for a couple of days before it dived to level below it. It continues downwards and tested the second support of $461 before it re-surfaces for oxygen. Once it came out from the under-water and traded above $475, I know I’ve to get ready to take my money and run when the opportunity comes. And it did come – partly helped by the news of the resignation of the technology chief of Yahoo Inc. (Nasdaq: YHOO, stock) yesterday. Since Google is a very expensive stock, I couldn’t afford to buy option with very high time-value. Hence, I guess this would be my best opportunity (no more greed this time) to ring the register.