Wednesday, June 22, 2011

Google Inc - (GOOG) - Inside Day

Google Inc. (GOOG) has been trending lower over the past few months and has now put in an inside day. An inside day is simply a day where the range is contained within the previous day's range.

What I like about inside days is that they sometimes lead to nice trending moves over the next 1 to 3 days. The last inside day that GOOG had was on June 9th and you can see the sell off that took place over the next day or so. On May 3rd we had another inside day but as you can see there was no follow through.

In my experience inside days seem to work about 60% of the time which isn't bad when you consider that most things in the market do not work.  When you combine an inside day with the current trend and trade the breakout in that direction, the odds of success improve to about 65%.

Being that GOOG is in a down trend, I will be watching for this stock to take out the low of the inside day for a possible short entry. 

Today Google Inc. (GOOG) closed at 487.00 which was down 1.22% from Tuesday's close.

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