How To Trade Alphabet (GOOGL) Stock Before And After Q3 Earnings

Zinger Key Points
  • The consensus estimate for Google’s earnings per share comes in at $1.26 on revenues of $70.94 billion.
  • Bullish traders want to see the stock regain the 50-day SMA as support.

Alphabet, Inc GOOG GOOGL will print its third-quarter earnings after the bell on Tuesday. The stock was rising over 1% heading into the event, for a total increase of 6% over the last three trading days.

The stock started to trade on a 20-1 split adjusted basis in the middle of the quarter, on July 18.

In the trading session following Google’s second-quarter earnings miss, the stock gapped up over 3.9% and rallied and additional 3.65% intraday. For that quarter, Alphabet reported EPS of $1.21, missing the $1.31 estimate, and revenues of $69.7 billion, which missed the $70.35-billion estimate.

For the third quarter, the consensus estimate for Google’s earnings per share comes in at $1.26 on revenues of $70.94 billion.

KeyBanc Capital Markets’ analyst Justin Patterson cut the price target for Alphabet on Tuesday from $125 to $120... Read More

Traders will be watching closely to see how Alphabet reacts in the aftermarket trading session. Holding a position in a stock over earnings, especially for options traders who must consider "premium burn," is risky because a stock can drop following an earnings beat and rise following a loss.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

The Alphabet (GOOG) Chart: Alphabet reversed course into an uptrend on Oct. 13 after printing a new 52-week low at $95.27. The stock’s most recent higher low was formed on Oct. 21 at $98.23 and the most recent confirmed higher high was printed at the $104.22 two days prior.

  • On Tuesday, Alphabet gapped up slightly to start the trading session and attempted to rally intraday. The stock was heading toward the 50-day simple moving average (SMA), and if Alphabet can regain the level as support it will indicate longer-term sentiment has turned bullish.
  • The rise higher was taking place on lower-than-average volume, which may cause some bullish traders to be concerned. Bulls want to see stocks move higher on higher-than-average volume to indicate a high degree of interest in the stock.
  • Bearish traders want to see Alphabet suffer a bearish reaction to its earnings print that will cause the stock to print a double top pattern at Tuesday’s high-of-day. If Alphabet falls below the $98 level, the uptrend will be negated.
  • Alphabet has resistance above at $106.53 and $111.50 and support below at $101.08 and $97.79.

goog_oct._25.pngSee Also: Drip, Drip, Drip: It’s a Waiting Game as Investors Look for Direction from Microsoft and Alphabet After Close

Photo via Shutterstock.

Market News and Data brought to you by Benzinga APIs
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: EarningsLong IdeasNewsShort IdeasTechnicalsPreviewsTop StoriesTechTrading Ideas
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!