Let's take a look at Google (GOOG), a stock that has been lagging lately. Three sizeable gaps, a veritable Swiss cheese, sit unfilled directly below (there are more below 300, but we will stick to these). 303.20, 341.89 and 415. Today's close put GOOG below the 10 day ema and out of the ascending channel started in March, so I expect the 415 gap to be closed very soon, if not tomorrow. After that, the stock better hold the 20 day moving average at 411, or we are headed sub 400 in no time. It would be worth a long trade between 411 and 415, but keep tight stops at 407 or so. Eventually, all three of these gaps should get closed, but that will probably have to wait for what appears to be a second half market correction brewing.
This entry was posted
on Thursday, April 27, 2006 at 5:38 PM.
