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Alphabet Inc. Message Board

  • itm2000 itm2000 Mar 2, 2006 9:18 AM Flag


    Basically, the game has changed. That's about it. It's changed. Many think the game is over. But it is not. It has merely changed.

    The change is that GOOG stock is no longer the invincible Titan that it was prior to Jan 20 this year. It is no longer impervious to extreme calamities. It has new downward pressures that can be suddenly and catastrophically cataclysmic in scope and nature. Fortunes can be lost as fast as they used to be made on GOOG trades. One can see gains or new investments vaporized in seconds.

    Therefore, one must simply be willing to either hedge ALL bets (long or short bets) and/or trade BOTH sides (long and short) with fluidity.

    Fundamentally, GOOG is fact, it is better than ever. And, its strength and ability to be able to bounce back is almost legendary. It's future is hugely bright. It is like MSFT or CSCO or INTC in 1990...except MUCH more promising than even those Goliaths.

    Long term, there is NO problem with GOOG but you should go ahead and protect even VERY long term strategies with SOME sort of hedging such as gathering cheap puts along the way for those rainy days ahead...or being willing to write covered call options against your long position from time to time, etc.

    The intermediate term will end up being generally quite bullish over the next 3-6 months.

    The short term will be very rocky over the next 1-2 months.

    The very near term will be extremely challenging from today's action on over throughout the upcoming few weeks.

    From today through April 25, GOOG stock could remain EXTREMELY volatile with swings that could cover a span of as much as $100 in a single day (eg: a swing whereby the stock goes green $50 and then red $50 in the same day is not impossible, although that is not probable). We could see lows between now and April 25 of BELOW $200 a share and highs that could go over $500 a share. Pretty dramatic dynamics are in play here. You have to be ready on both sides or get out of this stock.

    What is my own opinion of what we WILL actually see? Probably a rather strong rally upward will end up occuring today with GOOG ending the day WELL into the 380s-390s. But we could be tested and challenged as the conference begins...with GOOG stock riding on EVERY SINGLE WORD UTTERED between 10am and 2pm PT. Real rocky. The Q&A session is going to be VERY, VERY interesting. In the end, it will be very favorable. There will be positive new data and news during this conference that will be very positive. Beyond today, I think we'll keep showing more and more strength, overall, with some very positive days ahead as we approach the E/R which will probably be on Thursday, April 20 after the bell. YHOO and EBAY will have E/Rs the two days prior, undoubtedly. All will be well and much confidence will have been restored in GOOG stock as it continues its march upward. The general feeling will be that there was never anything to fear after all. I believe we will surpass the 450-500 level by May 1. I think we will see no lower than 330-340 between now and then. That said, everyone MUST be hedged at ALL TIMES no matter what. Best is to use puts. It is WELL worth it. There will be enormous gains (as there already has been since the $85 IPO) to protect as we navigate through this year. But, a $50-$100 slide on ANY negative news (real or imagined) could occur in SECONDS at any be ready for that and be willing to sacrifice some money for insurance (puts).


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