Tuesday, August 02, 2005


Here is an updated hourly chart of Google.

The last time I posted on GOOG it had broken below the 1/2 point of the current box at 292 so I concluded that it was headed for the low of that box near 268. Today GOOG has moved smartly back above the 292 level. What to do?

Even if GOOG is now on its way to my 343 target I think we will see a continuation up to 304 (roughly the 3/4 level of the box) and then a reaction back down near 292. If this sequence of events unfolds I will be watching to see if GOOG starts to trade sideway for a few hours as it approaches the 292 level. If it does I think that would mean that the market is about to turn sharply higher.

Since I am still very bullish on the broad market I think this scenario in GOOG is a better than 50-50 bet.

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