Alphabet Ended Wednesday With A Key Reversal Day. There Is A Potential Weekly Key Reversal On Friday
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Traded to a new year-to-date high of $129.04 on Wednesday, June 7, 2023, then closed at $122.50 below the June 6 low of $125.35. This defines a downside key reversal day. A weekly key reversal day will occur if Friday’s close on June 9 is below last week’s low of $122.00.

Alphabet has a p/e ratio of 28.35% and does not offer a dividend according to Macrotrends. The company has missed earnings-per-share estimates in four consecutive quarters between April 26, 2022 and February 2, 2023.

The Daily Chart for Alphabet

Courtesy of Refinitiv XENITH

Alphabet has been in a downtrend since trading as high as $122.43 on August 16, 2022. As part of this downside risk is that the stock was well below its 200-day simple moving average until a breakout occurred on February 2, 2023. The low over the last 52 weeks was $83.34 set on November 3, 2022.

After the low, the stock rebounded and popped above its 200-day simple moving average on February 2, then at $104.91. The 50-day simple moving average began to rise on January 12, 2023 from $92.41.

The bull market rise that began on November 4, 2022 was confirmed by a golden cross that was confirmed on May 3, 2023. This prompted the 54.8% bull market gain to $129.04 on June 7.

The horizontal lines from bottom to top are the monthly value level at $110.89, the annual pivot at $119.99, the quarterly pivot at $127.98, and the semiannual risky level at $134.80.

The Weekly Chart for Alphabet

Courtesy of Refinitiv XENITH

The weekly chart for Alphabet is positive and extremely overbought with the stock above its five-week modified moving average at $116.70. The stock is well above its 200-week simple moving average or ‘reversion to the mean’ at $100.06. The 12x3x3 weekly slow stochastic reading is well above the overbought line of 80.00, at 90.77.

Trading Strategy: Buy Alphabet on weakness to its ‘reversion to the mean’ at $100.06. Reduce holdings on strength to its semiannual risky level at $134.80.

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