Trading Strategies For Alphabet Stock Before And After Q3 Earnings

Alphabet, Inc GOOG GOOGL is set to print its third-quarter earnings after the market close on Tuesday.

Analysts on average expect Alphabet will print EPS of $1.44 on revenues of $75.87 billion.

When Alphabet printed second-quarter earnings on July 25, the stock gapped higher the next day and closed the trading session up over 5.5%.

For that quarter, Alphabet printed earnings of $1.44 per share, which beat the analyst estimate of $1.20. The Google parent company reported quarterly revenues of $74.604 billion, beating the $65.42-billion estimate.

Several analysts weighed in on the stock ahead of the event, with all three applying a price target above Alphabet’s current share price. Read More...

From a technical analysis perspective, Alphabet looks bullish heading into the event, attempting to break up from a possible bull flag pattern on the daily chart. Of course, holding a stock or options through earnings is akin to gambling because a stock can fall on a positive print and soar on negative results.

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The Alphabet (GOOG) Chart: Alphabet’s possible bull flag was formed between Sept. 26 and Monday, with the pole created between Sept. 26 and Oct. 12 and the flag forming afterward. The measured move, if Alphabet breaks up from the flag on higher-than-average volume, is about 11%, suggesting the stock could head toward a new all-time high of $150.

• If Alphabet receives a bearish reaction to its earnings print and falls under the 50-day simple moving average (SMA) the bull flag will be negated and the stock could retrace to fill a lower gap, which exists between $123.69 and $127. Below the gap, the stock could find support at the 200-day SMA.
• If Google receives a bullish reaction to the print and reaches a new all-time high, no investors will be in the red and the only resistance above will be at psychological support areas. If that occurs, the stock’s relative strength index heading into overbought territory could cause some traders to exit and wait for a retracement.
• Alphabet has resistance above at $140.25 and at $146.82 and support below at $134.07 and at $131.40.

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