Technical Analysis – Google bears eye 1,420 for more downside in short-term

Christina Parthenidou, XM Investment Research Desk

Google stock shifted south after peaking at an all-time high of 1,501 on January 22 but the bears should push below 1,370 and under the ascending trendline to put the upward pattern in the bigger picture in doubt.

In the near-term, the focus will be on the 1,420 level as the RSI and the MACD suggest a neutral-to-bearish bias for the coming sessions. This is also where the 23.6% Fibonacci of the 1,159-1,501 upleg meets the 50-period simple moving average (SMA). Clearing that obstacle, the price could slip to test the ascending trendline and the 38.2% Fibonacci of 1,370, where any violation could bring additional losses probably towards the 50% Fibonacci of 1,329. If the latter falls apart too, then traders would lose confidence in the market’s uptrend, especially if the 200-period SMA fails to hold as well.

Alternatively, a rebound above the 20-period SMA would resume buying appetite with the 1,500 level coming next under the spotlight. Running higher, the bulls may look for fresh record highs somewhere near 1,550 and then around 1,600.

Summarizing, Google is likely to follow a neutral-to-bearish path in the short-term with nearby support and resistance expected at 1,420 and 1,462 accordingly. In the bigger picture, the stock is still in a healthy uptrend, though, this could come into question if the price retreats below 1,370.