The weakness on American techs continues in the wake of the Fed’s restrictive policies. These stocks also include Alphabet, which published its quarterly results last night, which have disappointed expectations. In fact, Alphabet closed the quarter with net profits of $16.4 billion, down to $24.62 per share against the expected $25.91. The turnover was $68.01 billion, up 23% but lower than the expected $68.11 billion. Alphabet subsidiary subsidiary YouTube’s focus in social media and video sharing was expected to increase advertising revenue by 23% to $7.4 billion. It earned only $6.87 billion, which was below expectations. As with Meta Platforms, the company has been impacted by recent restrictions on targeted advertising introduced by Apple.
Alphabet [GOOGL.O] is at $2,352.3 (+2.3%) in pre-trading, after losing 3.7% yesterday. This is a bad break for the stock that punctured an important support in the $2,500 area before resting around $2,400. The SHORT position proposed yesterday hit the target at $2,262. We prefer closing the sell as yesterday’s candle could generate a nice rebound towards $2,400 today. It will be possible to reactivate the SHORT on Alphabet at a break with strength and closing at $2,262 or on the pull back at $2,400 (the strength of the recovery, however, must be examined).
We recommend going SHORT on the stock by buying the Leverage Shares Alphabet -1X ETP (ISIN: IE00BKTW9N20) on a break in strength and closing at $2,262. Target should be $2,200 and and stop/loss should be at $2,550.