Alphabet (GOOGL) Stock Looks Poised for a Surge

Alphabet Inc. (NASDAQ: GOOGL) seems poised for a price surge based on its latest charts. The company offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments.

The stock was also a part of our watchlist for breakout stocks.

Bullish Indications

#1 Breakout from Ascending Triangle:  The daily chart shows that the stock has currently broken out of an Ascending Triangle pattern with high volume. An Ascending Triangle pattern is a bullish pattern. This is marked on the daily chart in purple lines. A breakout from this pattern typically indicates bullishness. The base of the triangle generally acts as a good support level after the breakout.

#2 Price above MAs: The price is currently above the short-term moving average of 50-day SMA as well as the longer-term moving average of 200-day SMA, indicating that the bulls are still in control. This is a positive indication.

#3 MACD Above Signal Line: In the daily chart, the MACD line (light blue color) is currently above the MACD signal line (orange color), which is typically considered bullish.

#4 Bullish ADX: The ADX indicator shows that the +DI line is currently above the –DI line and the ADX line has started to move up from below the –DI and +DI lines. This indicates possible bullishness.

#5 Above Support Area: As you can see from the weekly chart, the stock has currently moved up from a resistance-turned-support level. This level is marked as a pink dotted line. This looks like a good area for the stock to move higher. The stock is also trading above its 50-week and 200-week SMA, indicating that the bulls are still in control.

#6 Bullish Aroon: The value of Aroon Up (orange line) is above 70 while Aroon Down (blue line) is below 30 in the weekly chart. This indicates possible bullishness.

#7 Positive OBV: The weekly chart shows that the OBV indicator is currently rising. OBV rises when volume on up weeks outpaces volume on down weeks. A rising OBV typically reflects positive volume pressure that can lead to higher prices.

Recommended Trade (based on the charts)

Buy Levels: If you want to get in on this trade, you can purchase shares of GOOGL above the price of around $231.00.

TP: Our target prices are $250.00 and $265.00 in the next 3-6 months.

SL: To limit risk, place a stop-loss at $220.00. Note that the stop-loss is on a closing basis.

Our target potential upside is 8% to 15% in the next 3 to 6 months.

For a risk of $11.00, our target rewards are $19.00 and $34.00. This is a nearly 1:2 and 1:3 risk-reward trade.

In other words, this trade offers nearly 2x to 3x more potential upside than downside.

Risks to Consider
The stock may reverse its overall trend if it breaks down from the breakout level of the ascending triangle pattern with a high volume. The sell-off of the stock could also be triggered in case of any negative news, overall weakness in the market, or any regulatory changes in the sector.

Happy Trading!

Tara

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