Lets look at the price action in GOOG the past few sessions and breakdown the relative strength compared to the broader $NDX and $SPX markets.
The chart is showing a touch of the 200 day moving average at today’s lows. I drew the line from the break down bar two weeks ago to today lows and I want to compare the price action on 11/08 to the RSI plot. Then let’s look at the current price action today and the RSI plot. We see the RSI has slightly, and I mean ever so slightly, diverged as price makes new lows intra- day. If this is any indication of dip buying, we should see GOOG go through an aggressive bounce stage once the market finds its legs again.
GOOG should lead the way and exhibit a green day as the market dips red in my opinion. With aggressive price follow through higher, taking a leadership role for tech. That would be the best scenario. The only problem with this type of technical picture is the RSI is a lagging indicator and can sweep lower if GOOG gaps down and this entire theory is out the window. Watch the market and GOOG action at these levels closely through next week (Holiday week) and see if a long side swing trade is in the cards.