Market Trends

Alphabet Inc: The Future of Google Stock Depends on This

Alphabet Inc: The Future of Google Stock Depends on This

  • Buz Investors Future of Google Stock Depends  For years now, bad economic news has been interpreted as good news for the stock market. These poor economic numbers have translated into easier monetary conditions and have reinforced a low-interest-rate environment.
  • Investments like Alphabet Inc (NASDAQ:GOOG) stock, otherwise known as Google stock, do well under such conditions because investors seek growth in a low-interest-rate environment and, as a result, growth companies warrant having high valuations.
  • The dynamic of the financial markets started to change in early fall as interest rates started to rise. This move higher in interest rates accelerated after Donald Trump won the presidential election.

Future of Google Stock Depends

Alphabet Inc: The Future of Google Stock Depends on This

Markets have soared to all-time highs, and bullish records have been shattered, but all this euphoric equity market action is overshadowing the fact that the bond market has had its worst performance in years. When bonds sell off, yields rise.

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Future of Google Stock Depends

This is why Google stock has been left out of the “Make America Great Again” rally; higher interest rates are not favorable nor beneficial to growth stocks.

The Google stock chart above illustrates the uptrend that has supported the price since GOOG stock first went public in 2004. The uptrend is created by connecting the troughs on the price chart using a trend line. This trend line symbolizes the entire bull market in Google stock; a bull market that has traveled from the bottom left to the upper right on the price chart.

Google Stock: Growing Pains

As Google stock has been bouncing off of trend line support, it is also battling the 200-day moving average. The 200-day moving average is the dividing line between stocks trading in a bull market versus stocks trading in a bear market. When the share price is above the moving average, it is bullish. When the share price is below the moving average, it is bearish.

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One camp will soon be declared the winner, and the price will dictate what happens next. I am concerned what a break of this trend line would mean for the entire growth sector.




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Jadtecnic
Richard Dambrosi (JADTECNIC) Has Been Sharing Forex Analysis Trending Markets News since 2011. Editors and Founder of InvestorsBuz.com , has a passion for Forex Social Sharing analysis and Market Trends Such as Self Driving Cars , Electric Cars, Medical Marijuana , 3d printing and Cloud computing , Refers to Readers as BUZ INVESTORS.

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