Google (GOOG) PriceWatch Alert Support At Around $510.84

Posted on Monday, July 14, 2008 8:07 AM

Google (NasdaqNM: GOOG) ended the last trading session at $533.80. So far the stock has hit a 52-week low of $412.11 and 52-week high of $747.24. Google stock has been showing support around 510.84 and resistance in the 550.98 range. Technical indicators for the stock are Bearish and S&P gives GOOG a neutral 3 STAR (out of 5) hold rating. GOOG appears on the Investors Observer Analysts Favorites list. For a hedged play on this stock, look at a Sep '08 590 covered call (GOO IR) for a net debit in the $519.30 area. That is also the break even stock price for this trade. This covered call has a 68 day duration, provides 2.72% downside protection and a 13.61% assigned return rate for a 73.08% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the GOOG Jan '09 460 Call (OUP AZ) and selling the Sep '08 590 call (GOO IR) for a $90.95 debit. The trade has a 68 day life and would provide no downside protection and a 42.94% assigned return rate for a 230.00% annualized return rate (for comparison purposes only). Google does not pay dividends at this time. [For more information on these strategies along with more details on possible risks go to www.iotogo.com/HPWAinfo]