Google stock (GOOG) seems ready to resume its climb, based on the buy signal from indicators seen on its daily time frame. Recall that the tech company recently announced a stock split to GOOG and GOOGL, thereby driving stock prices down. This move was seen as a way for the founders to have more flexibility in managing the company.
This means though that investors holding these shares will have twice as much stocks but that the value will decline for a while. Traders who want to add to their positions take this as a buy signal for Google stock.
On the daily chart, it can be seen that Google stock price is testing the 100 MA (moving average). This has acted as a dynamic support level in the past and may continue to do so moving forward. In addition, stochastic has moved to the oversold zone indicating a potential bounce.
Stock Buy Signal Forecast
The stock is still in a clear uptrend on the daily time frame as the company has made tremendous progress in terms of developing technologies and perfecting its web offerings in the past months.
A deeper selloff could still go as low as the 200 simple moving average, which appears to be the next major support area. However, it is not likely that the pair will dip below the 1000.00 major psychological mark.
As you can see on the daily chart, the pair has previously found support around the 1100.00 level back in January this year. As price is testing that level, many analysts say that it is already a buy signal for Google stock.
Take note though that price has recently broken below a rising trend line connecting the lows from October, November, and January. This may be indicative of a downtrend or a larger market correction. The next support level is located at the 1000.00 major psychological level.
The new GOOGL shares are expected to start trading today and analysts will get a glimpse of how this will affect stock prices in the New York trading session.
To contact the reporter of the story: Jonathan Millet at firstname.lastname@example.org