DailyPlay – Opening Trade (GOOGL) – July 16, 2024

GOOGL Bullish Opening Trade Signal

Investment Rationale

GOOGL is strategically positioned to capitalize on the growing demand for AI and cloud services, driven by its robust investments in AI technologies and the continued dominance of YouTube as a leading digital platform. The recent pullback in GOOGL’s stock price offers an attractive entry point for investors looking to gain exposure to these high-growth areas.

Technical Analysis

GOOGL has recently pulled back slightly within a strong bullish trend, creating an attractive entry point. The stock has consistently outperformed the market, and the recent dip offers a lower-risk opportunity to gain exposure. With positive momentum, the pullback provides a healthy consolidation within an overall strong bullish trend.

GOOGL – Daily

Fundamental Analysis

GOOGL trades at 24x forward earnings, which is reasonable given its strong growth prospects. The company is expected to grow EPS by 18% and revenues by 11%, significantly outpacing the average S&P 500 stock. Additionally, GOOGL boasts industry-leading net margins of 25.9%, reflecting its efficiency and profitability. 

Trade Details

Strategy Details

Strategy: Short Put Vertical Spread

Direction: Bullish Credit Spread

Details: Sell to Open 3 GOOGL Aug 30, 2024 $185/$175 Put Vertical Spreads @ $3.59 Credit per Contract.

Total Risk: This trade has a max risk of $1,923 (3 Contracts x $641) based on a hypothetical $100,000 portfolio risking 2%. We suggest using 2% of your portfolio value and divide it by $641 to select the # contracts for your portfolio.

Trend Continuation Signal: This is a bullish trade on a stock that is in a strong bullish trend, and expected to continue higher.

1M/6M Trends: Bullish/Bullish

Relative Strength: 9/10

OptionsPlay Score: 92

Stop Loss: @ $7.18 Debit. (100% loss to the value of premium)

View GOOGL Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Monday’s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View GOOGL Trade