This is a tough time of the year to make trading
recommendations, as volumes are low, the market has pulled back,
and sentiment has soured. That said, this is the best time to scour
through the market for some oversold positions that are set to
And few positions look more ripe for a bounce than a company whose
headquarters I stayed right next to this weekend in Silicon Valley,
Google, of course, needs no introduction. With more than 300
million users around the world a day conducting searches, it is by
far the most popular search engine on the planet.
Over 25 advertisers spend more than $150 million in advertising on
Google each year.
And its bevy of unrelated projects-driverless cars, Google glasses,
and the new Google Chromecast Internet TV device-position Google to
dominate our lives for years to come. That's why I've called Google
) of the 21st century."
From a trading perspective, as one member of my staff put it,
Google today looks like "a gift from the trading gods." Looking at
a wide range of technical measures, the stock is massively oversold
and is due for a bounce.
If you happen to be a technical analysis buff, you can look at Fast
stochastics, RSI, Bollinger Bands, support at both $850, and its
100-day moving average. The stock also is touching the lower trend
line drawn on its one-year daily chart.
The bottom line? When you throw in an unwarranted negative mood
swing of Mr. Market and a heckuva lot of other factors that have
come together, Google appears due for a strong bounce.
So consider buying Google at market and placing your initial stop
at $800. If you want to play the options, consider buying the
December $900 calls.
Editor's Note: This article was written by Nicholas Vardy of
Bull Market Alert
Below, find some more great investing and trading content from
US Intervention in Syria Odds Raised
Detective's Clues for Finding Income
Compelling Case for Energy