Coming into the report on Thursday after the close, Alphabet stock was up just 3.1% over the prior six months. With Friday's 9.6% rally, though, the stock is surging and looking for new highs.
Will Alphabet stock find them?
To do so, the stock will need to run to about $1,300 per share. Showing that it finally has its groove back should help, though. Earnings of $14.21 per share came in $2.75 per share ahead of expectations. Revenue of $38.94 billion grew 19.2% year-over-year and beat analysts' estimates by more than $700 million.
The company also announced a $25 billion buyback, surely giving bulls even more reason to gobble up the stock.
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Trading Alphabet Stock
Despite Alphabet's strong results, the FAANG+M group is somewhat mixed. Apple (AAPL) - Get Apple Inc. (AAPL) Report , Microsoft (MSFT) - Get Microsoft Corporation (MSFT) Report and Netflix (NFLX) - Get Netflix, Inc. (NFLX) Report are all moving higher, while Facebook (FB) - Get Facebook, Inc. Class A Report remains roughly flat near $200. Amazon (AMZN) - Get Amazon.com, Inc. Report stock is down slightly, falling 1.6% after also reporting its earnings results.
Alphabet stock is by far the leader in mega cap tech on Friday.
But as it currently trades right near $1,250, it's a bit in the middle of the range we're watching. Shares either need to rally another $50 toward $1,300 and get to new highs, or they need to fall another $50 or so into support.
If it's the latter, Alphabet stock has found $1,200 to be a significant level. It's also about where it will run into prior short-term channel resistance. If this level becomes support, it can pave the way to a new trend -- and higher prices.
Let's see how Alphabet stock trades on Monday, "day two" after reporting earnings. If the stock takes out its post-earnings day low, support is likely to be called upon. If it takes out its highs, it increases the odds that GOOGL stock will run to the $1,290 area, where it has twice topped out in the past year. It will be up to investors then to push the stock to new all-time highs or let it digest the move and consolidate beneath resistance.
Whichever way it goes, the ball is now back in the bulls' court. It's now up to investors to decide how bullish they want to be with Alphabet stock.
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This article is commentary by an independent contributor. At the time of publication, the author had no positions in the stocks mentioned.