Shares of Alphabet continued their decline on Friday with a 3% drop in price.
Investors continued to react to the company's earlier earnings report and outlook, which included a drop in revenue forecasts.
That forecast comes as the company plans on an extremely large capital expenditure into its AI spending following its slow cloud growth in the fourth quarter.
The stocks’ outlook and price activity has caused negative reaction from Wall Street analysts, including headlines from barons that the stock may see some pressure on downgrades.
From a technical perspective, Alphabet shares took out two key price levels on Friday.
The first is round Number support at $190.00, that price has held the stock for the last month and a half as support.
In moving below the $190.00 level. Alphabet also dropped below its fifty day moving average. That trend line has been in a bullish trend since October, when the stock started its rally at $165. This week's reversal from a price above 200 to its current price of 185 is drawing the attention of retail investors.
Volume of Google shares traded on the last three days of weakness exceeds its average daily trading volume.
Alphabet shares are likely to find round Number support from the $180 price level. This price served as resistance for the stock in November before Alphabet shares ripped through it following the previous quarter’s earnings report.
Shares remain in a long-term bull market trend, therefore any weakness to the $180 or $175 level is likely to be met with long-term buying interest in the stock.
