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GOOG: Open High Was Sold

July 18, 2008 10:18 AM

It looks like GOOG would have to clear the open high to have any chance of improvement here. I am not going to look at it intraday, just giving a heads up. The problem in this range is the gap higher from previous earnings has now filled. So not certain how much lower it will trade. It “might” be in a tight range here, not sure. But my personal “guess” is traders will short strength near the open high unless it clears, but will be cautious shorting near the lows, but would have to watch it intraday to see whats going on. If you notice, the gap from April has been slightly filling and has made me skeptical of GOOG, but earnings were coming, so there was no way to know what would happen.

The market is in a tight range here. It never has cleared yesterdays highs, so the fear factor on selling is likely to be reasonably mild. If we can get over yesterdays highs and then reverse, we would likely see pressure late, if negative. But no dice. So the volatility is mild early on. Oil has driven the markets lately, so that could be the key as the day wears on.

Also, it is “possible” that if we can clear yesterday’s highs late AND hold, more shorts may cover. The direction here is marginal, at best and it is expiration day, so there may be moves that do not seem to make any sense as traders are squaring positions. Not a fan of trading on expiration days because of this.

Written by Tom@StockBlade.com · Filed Under GOOG 

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