Last updated on May 7th, 2023 at 01:33 pm
In this blog post, we will look at Google stock (GOOG) on a weekly stock price chart. We will be using technical analysis to find out when it might be a good time to buy or sell the stock.
The first step in technical analysis is to identify the trend. Upon examining the weekly chart of GOOG, we observe that the stock had been trading sideways since the last 1 year. There is no clear upward or downward trend yet.
Support and Resistance Levels
First, we can locate the crucial support and resistance levels on the weekly chart. The support level indicates the price at which buying pressure is expected to arise, while the resistance level denotes the price at which selling pressure is expected to emerge.
The stock has two strong support levels at $100 and the 200 weekly moving average at $98. Hence, it is unlikely for the stock to go below this level. Talking of resistance, there is a small level of resistance at $110, but a stronger one at $121 as shown in the image above. The stock also just crossed the 50 weekly moving average. Hence, that could also act as a strong support level.
Technical Indicators
Technical indicators can also be used to identify potential entry and exit points. In this analysis, we will be using the moving average convergence divergence (MACD), relative strength index (RSI) and stochastics.
• The MACD, a dependable metric for evaluating trends and stock momentum, indicates a bullish trend as the violet line has been above the orange line for weeks. Since these lines are still in the bottom band of MACD, it seems likely that the stock will further move up in the coming weeks.
• RSI is another effective tool for determining whether a stock is overbought or oversold. When the RSI crosses above 30, it indicates a buy signal, and when it crosses below 70, it indicates a sell signal. The RSI is currently trending upwards and is around 58, suggesting that the price may rise further before cooling down.
• Stochastics, another technical indicator, can help investors predict whether the stock will continue in its current direction or undergo a trend reversal. When the black line crosses over the red line, it is considered a bullish sign and vice versa. The black line has been above the red line for some time, indicating that the sentiment is bullish. But, a level of 87 indicates that it is nearing a trend reversal.
Should I buy GOOG stock now?
After analyzing the weekly chart of Google stock, we can say that technical indicators are showing a mixed indicator. The trend chart further shows that the current stock price is close to support. Given this, I would expect the stock price to not fall much before starting to go up. Hence, any drop of over $5 from current level would be a good buy.
So, considering the long-term potential of the stock, a stock price along the resistance levels, i.e between $98 to $103 is be good entry price.
As with all investments, it is important to conduct your own research and analysis before making any trading decisions.
