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.
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.
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.
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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