GOOG / GOOGL Update

I was taking a look at GOOG anyway when a member asked about GOOGL, the Class A shares. I don't see too much difference in share statistics as far as the short ratio and percentage of float, they are both fairly low, around 1.5 to 2.15 (short ratio) approx, the institutional sponsorship of GOOGL is understandably lower as class A shares (usually for board member's, etc. with enhanced voting rights, although I don't know the particulars of GOOG's class A, but typically about 10 votes per share rather than 1. The premium on the GOOGL shares is about +1.7% or about 10 points.

As mentioned, both have fairly low short interest, with ratios between about 1.5 and 2.15 or so. Looking at both, other than the slight premium on GOOGL, I don't see a big difference in the underlying trade, although ther are small differences here and there.

I'll say right now if given a choice between a SCTY and GOOG, I'd take the SCTY personally, but here are the charts for you and you can see what you make of them.

 The daily GOOG chart with the Ultimate Oscillator, a cleaner, slightly more reliable version of Wilder's RSI with a divergence at the March highs and a smaller one in this choppy, wide range,

 GOOG again with the U.O. on a 1-day chart showing the same positive divgerence we saw in 3C at the start of August in the broad market including averages and just about every stock we looked at, this was the stage 1 base of the August cycle.

The 60 min X-Over system as a swing trade signal is just going short, 2 of 3 indicators are there and the custom one in the middle should cross below its blue 22-bar m.a. soon.

As for the longer term 3C charts on a daily basis, this is GOOGL which looks to have a slightly worse longer term trend, GOOG's daily is below.

While the divegrence is negative here as well, the GOOGL chart looks a bit worse.

On a longer term 5 day 3C chart, GOOGL looks about the same as GOOG

 5-day GOOG 3C chart

On a 4 hour chart, GOOGL looks slightly worse than GOOG, but not by a significant difference.

GOOG seems to make up for it on the 2 hour chart so I suspect there's just a little difference in the readings and all in all, there's really not too much difference except the fact the long term trend in GOOGL does look a bit worse overall.

 On an hourly chart the two are nearly identical, both negative divergences coming through this wide, choppy range, more or less a swing trade type range, which is why the 60 min X-OVer chart was included. If I were interested in GOOG short, I'd likely start on the basis of a swing short and if it deteriorates and starts to give more, widen out my stop to see if it will turn to a position trade.

During a downtrend there are a lot of long only funds that will seek out the higher quality/dividend paying stocks as they have to chose the lesser of two evils, there's not really a good choice in a bear market for a long only fund so it's more about minimizing damage and protecting capital as best they can.

The low short interest in both GOOG and GOOGL can be a problem if there is a sharp decline because there isn't a built in pledge for demand in the future when it's most needed, during a sharp sell-off which is what short sellers provide, thus a lot of long funds prefer to see a fairly healthy amount of short interest as it is future demand that has to be made good on.

 GOOGL does have a slightly worse looking 30 min chart through this wide-ranging chop zone than GOOG, but again, not by so much that it would cause me to move away from GOOG.

Both are showing the recent distribution from last week's Chimney head fake move as you can see on this GOOG 10 min chart, also showing early Aug. accumulation, the recent negative divegrence being quite sharp and...

 GOOGL last week specifically as we were calling for a move up off Monday's lows which saw some accumulation with HYG's help and the distribution in to Friday as the head fake Chimney was created in the averages.

 In the 1-5 min range there's virtually no difference, GOOG above is showing the same kind of intraday positive divegrence I talked about earlier taking shape in the averages, the process is still underway.

For me, an entry in GOOG/ GOOGL would need to break above the recent wide chop, which almost looks like a triangle, but I think that's coincidental. I'd want to see a move in to the yellow zone and the same kind of sharp leading negative divergences seen late last week on the 5 and 10 min charts above.

Again, not my favorite short, but if the right entry shows up (set price alerts), it could make up for some other short comings vs. some other assets that I like more.