Google (GOOG) Headed Toward $1000 if...
10/20/2010 12:01 am EST
Quietly, that little advertising sales company in California, I mean technology company, Google (GOOG), has brushed off its tiff with China and is back on track. It had a massive move in its stock last week from strong earnings and a good forecast—a gap up of 10%. As I write this, Google is trading at $611 and seems to be resting. A well-deserved rest given its move, and what you would expect, right? Look at that daily chart below.
Through $650, My Target Is $1000
There it is, I said it! I am not just trying to shake things up while you sit on your hands waiting for Apple (AAPL) earnings. Here is the analysis: There are only three key resistance points in Google’s way to having a $1000 target on its back. Yes that is $1000, with three zeros. First note on that daily chart the high of $629.51 near the beginning of the year. That is the first resistance point. Now shift your eyes to the weekly chart below.
A weekly close above the $644-$650 area would create a massive inverse head-and-shoulders formation. There is a range because of the slight positive slope to the neckline. Notice that the top of the head is at $247 and the neckline there is at about $612, making for a $365 difference. This creates a target upon a break of the neckline higher of at least $999 if it were to happen this week. That leaves only the past high of $747.24 as the last resistance in the way of a $1000 target.
So, expensive stock, or time to think about getting in? Let me know your thoughts in the comments area below.
By Greg Harmon of DragonflyCap.com