Swing Trading Opportunity: Alphabet (May 2023)

"Look!"

"That's a rare Lamborghini! It's an Aventador SVJ!"

"Orh."

Have you shared something enthusiastically, only to be met with indifference?

The unemployment claims number rose and the US stock market didn't bat an eyelid. 

It's surprising. 

But then again, that's the stock market. 

Last week's swing trading opportunity: Uber is finally pulling back and getting ready for a swing trade.

There's a price level which I'm camping for, and you can find out about it here.

This week, we will be looking at Alphabet, the parent company of Google. 

Are you ready? 

Performance Of US Stock Market vs Alphabet (GOOGL)

The very 1st question you'll want to ask is: Are the shares of Alphabet outperforming the S&P 500?

A strong stock is more likely to continue outperforming, bringing you a greater return.

Judging from the chart above, you can easily tell that the shares of Alphabet have been consistently performing better than the S&P 500. 

Did you also notice that while the S&P 500 has been going sideways for a month, Alphabet's share price continued to rise? 

Are you ready for a deeper analysis on Alphabet's shares?

How Explosive Is Alphabet (GOOGL)?

Before swing trading any counter, you'll want to know whether the counter will be worth your time. 

This can be by measuring the up moves the counter has made in the past 6 or so months. 

In the span of 7 months, the shares of Alphabet have made 12 significant up moves! 

Each of these moves measures at least 6.3%, with the largest measuring 16.9%.

When you consider the market capitalization of Alphabet (a whopping $1.4t), its up moves are much more significant.   

Great! 

The shares of Alphabet passed this test admirably. 

Is it the right time to swing trade its shares? 

Key Price Levels

To find out if the time to swing trade Alphabet's shares is here, let's uncover its key price levels. 

Such price levels are also known as support and resistance zones. 

In the chart above, I've uncovered an immediate support zone at ~$108. 

This means that there's a high possibility of Alphabet's share price to turn when it falls to ~$108. 

And because the share price of Alphabet has risen by more than 11% in 1 week, a pullback could be near. 

I'll be expecting its shares to fall to ~$108 before heading higher, presenting a swing trading opportunity. 

You can set a price alert ~$108 and watch how its share price reacts. 

The Strategy You Can Use To Swing Trade Alphabet (GOOGL)

After comparing the performance of GOOGL with the broader US stock market, determining whether GOOGL has experienced explosive up moves, and identifying its key price levels, it's time to talk strategy. 

To stay in business, you must know your entry, profit taking, and stop loss levels in every trading strategy. Yes, trading is a business, which means that your strategy must be well thought out.

Using The Art of Explosive Profits (AEP) framework, I'd like to see GOOGL pullback to $108 before considering an entry for a swing trade.

As the name implies, you'll be looking to consistently catch an explosive move in a short period of time.

Instead of relying on news and hearsay, the AEP course will teach you how to screen stocks for swing trading like GOOGL.

You'll also learn how to read charts and identify stocks that are about to make a big move.

Finally, you'll learn how to identify the optimal entry, stop loss, and take profit levels to capitalize on these explosive moves (in a safe manner, of course)!

Can you apply the AEP framework to provide you with a side income while working full time? 

Yes, you can! 

Come, have a look at the AEP framework and incorporate this explosive trading strategy to your arsenal to capitalize on more swing trading opportunities.

Why Is Swing Trading GOOGL Worth It?

Alphabet is a household name, with its products (Google search, Google Mail etc.) playing a crucial role in our daily lives. 

It's also a company with a mega market capitalization whose shares have been enjoying explosive up moves. Such up moves are significant, making its shares worthy of a swing trade. 

Given that its share price is overbought, I think that the share price of Alphabet could be dropping in the coming days. This should present an ideal swing trading opportunity for us to seize.

While we wait for the pullback, please keep in mind that I'm not a financial advisor, so please treat this as edutainment and conduct your own research.

Lastly, all images are from pexels.com, pixabay.com, sectorspdrs.com, tradingview.com, and unsplash.com.

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