Google - A Manipulation Dump and an Antitrust Exit Pump
מעודכן
If you have a taste for anything like freedom of speech, neither Google nor YouTube are companies you will like. This thing started as a search engine that actually had the motto "Don't Be Evil" before it was corrupted by the Chinese Communist Party when "very smart people" wanted to get it into China.
You see, doing business with "China" right now always means licking the boots of the "Chinese Communist Party."
This means you have to toe the Party Line, and that means topics like the June 4 Tiananmen Square Massacre and the persecution against Falun Gong, and Hong Kong democracy have to be suppressed in accordance with whatever the regime says during the previous, current, and future 2 hour periods of each and every day.
It was then that Google developed a taste for its own form of shadowbanning and thought itself smart to roll out the CCP's ethos into its worldwide business model. When you search for content you get curated whatever gibberished and extreme leftist-establishment stuff it thinks it can give you to either attempt to nudge your opinion and values (DONALD TRUMP BAD!), or to just cover up the truth (try finding an update on the pandemic situation in China that isn't 2 weeks old).
As scary as all of that is, more terrifying is the way that Google is able to control the editorial direction of every single website on the planet, especially news media, by strictly controlling the web ads market, which it has controlled 90% of for many years.
Don't want to follow the Party's edicts on stuff like the Marxist revolutionary group Black Lives Matter destroying cities? Don't want to promote masking, social distancing, and mandatory vaccination during a "pandemic"?
Then they take your site's ad revenue away, for real.
Hint: there aren't many ways to make money with a website whose product is free words ("news") besides advertisements.
On Jan. 24 the US Department of Justice finally launched an antitrust suit against Google, seeking to financially penalize and force Google to divest its share of the markets.
What's scary about this for investors is that Google inked $209 billion in revenue from web ads in 2021. According to Q3 Financials, ~$167 billion of its $207 billion in revenue for the 9 months ending in September 2022 came from web advertisements.
This part of its business is pretty much what Google actually is. The search engine is really just there to dominate the Internet for the purposes of keeping the ad revenue train clutched in their own claws.
And curiously, when the DOJ made the suit's announcement, Google's share price only fell $6, and over the course of two days, before rebounding in the big tech short squeeze.
This is kind of a big deal because Google losing its web ad business means Google goes out of business, and US Government antitrust lawsuits aren't this kind of thing that they drop one day or that the courts or a jury will side against the administration on.
Google's Q4/FY22 earnings is Feb. 2 postmarket. This timing is especially significant considering that the FOMC rate hike is Feb. 1.
The question when facing a strange price action situation underwritten by big fundamental changes with multiple culminating timing catalysts is always: Is the stock going to go up or is it going to go down?
The thing about Google's monthly bars is there's a very small gap at $81.05, which was conveniently evaded in the October dump and kept off during the Nov-December market retrace.
The clearest view of overall price action is on the weekly candles:
My thesis is that Google will have a terrible earnings call, regardless of whatever data it puts out, because of the pending lawsuit. I suspect markets will bear trap with FOMC, regardless of the fundamentals. All of these come together to make me believe that February prints $79-$81.
Makes for a nice 25% short.
But when this arrives, I believe Google and the Nasdaq in general will actually turn around and really trend hard upwards, regardless of the fundamentals.
This makes for a nice 29.5% long if Google really only retraces into the $95 gap, and a 50%+ long if she goes into the $81 range.
I believe the reason a tech pump will happen is because the sector attracts the biggest suckers (retail, Robinhood, Reddit, Cathy Woods, Jim Cramer) and Wall Street will be using them to empty their bags.
Citadel and JPM and friends always buy low and sell high. They don't buy high and sell low. That's what you do.
If banks and funds did that, they'd be broke like you are, and we'd have Bear Sterns every month.
Once big tech starts to trend upwards, you have to be careful. The market will more or less do what Tesla did the last two weeks and just go uppy as weekly puts expire worthless.
And there will be no real sign of anything fundamental that should stop the train. Everyone will flip bullish for one reason or another (mah 200 DMA, meh trendlines, moh 76.321847234% Fibonacci) and it'll seem like it's time to get back to the good old days of 2021.
But it's not 2021. It's 2023, and everything is broken. Summer is going to be harsh, and Autumn will scare you.
And then the Chinese Communist Party will be destroyed by Wuhan Pneumonia seemingly overnight, and all the plans will be interrupted.
My advice to traders is to just risk a lot less and try to keep your risk within your winnings as much as possible. Also, if you really do see a black swan with China that crashes markets, don't buy that dip. Not even a scalp. It won't be like COVID hysteria was with 1,000 point up and down swings on the Dow this time. Everything will just gap down and stay down.
Liquidity will be a precious commodity.
One thing I've learned is that people never believe in what they think can't happen until it's unfolding in front of their face. Then they come back and are like "Wow it really did happen!"
Even I am subject to that flaw, because the length of time things take to unfold makes actually believing you are right very, very difficult.
That being said, I believe that we're looking at overall feverish bull market hysteria heading into May.
But what happens starting in May and heading into July is very likely going to change everyone's lives forever and ever.
You see, doing business with "China" right now always means licking the boots of the "Chinese Communist Party."
This means you have to toe the Party Line, and that means topics like the June 4 Tiananmen Square Massacre and the persecution against Falun Gong, and Hong Kong democracy have to be suppressed in accordance with whatever the regime says during the previous, current, and future 2 hour periods of each and every day.
It was then that Google developed a taste for its own form of shadowbanning and thought itself smart to roll out the CCP's ethos into its worldwide business model. When you search for content you get curated whatever gibberished and extreme leftist-establishment stuff it thinks it can give you to either attempt to nudge your opinion and values (DONALD TRUMP BAD!), or to just cover up the truth (try finding an update on the pandemic situation in China that isn't 2 weeks old).
As scary as all of that is, more terrifying is the way that Google is able to control the editorial direction of every single website on the planet, especially news media, by strictly controlling the web ads market, which it has controlled 90% of for many years.
Don't want to follow the Party's edicts on stuff like the Marxist revolutionary group Black Lives Matter destroying cities? Don't want to promote masking, social distancing, and mandatory vaccination during a "pandemic"?
Then they take your site's ad revenue away, for real.
Hint: there aren't many ways to make money with a website whose product is free words ("news") besides advertisements.
On Jan. 24 the US Department of Justice finally launched an antitrust suit against Google, seeking to financially penalize and force Google to divest its share of the markets.
What's scary about this for investors is that Google inked $209 billion in revenue from web ads in 2021. According to Q3 Financials, ~$167 billion of its $207 billion in revenue for the 9 months ending in September 2022 came from web advertisements.
This part of its business is pretty much what Google actually is. The search engine is really just there to dominate the Internet for the purposes of keeping the ad revenue train clutched in their own claws.
And curiously, when the DOJ made the suit's announcement, Google's share price only fell $6, and over the course of two days, before rebounding in the big tech short squeeze.
This is kind of a big deal because Google losing its web ad business means Google goes out of business, and US Government antitrust lawsuits aren't this kind of thing that they drop one day or that the courts or a jury will side against the administration on.
Google's Q4/FY22 earnings is Feb. 2 postmarket. This timing is especially significant considering that the FOMC rate hike is Feb. 1.
The question when facing a strange price action situation underwritten by big fundamental changes with multiple culminating timing catalysts is always: Is the stock going to go up or is it going to go down?
The thing about Google's monthly bars is there's a very small gap at $81.05, which was conveniently evaded in the October dump and kept off during the Nov-December market retrace.
The clearest view of overall price action is on the weekly candles:
My thesis is that Google will have a terrible earnings call, regardless of whatever data it puts out, because of the pending lawsuit. I suspect markets will bear trap with FOMC, regardless of the fundamentals. All of these come together to make me believe that February prints $79-$81.
Makes for a nice 25% short.
But when this arrives, I believe Google and the Nasdaq in general will actually turn around and really trend hard upwards, regardless of the fundamentals.
This makes for a nice 29.5% long if Google really only retraces into the $95 gap, and a 50%+ long if she goes into the $81 range.
I believe the reason a tech pump will happen is because the sector attracts the biggest suckers (retail, Robinhood, Reddit, Cathy Woods, Jim Cramer) and Wall Street will be using them to empty their bags.
Citadel and JPM and friends always buy low and sell high. They don't buy high and sell low. That's what you do.
If banks and funds did that, they'd be broke like you are, and we'd have Bear Sterns every month.
Once big tech starts to trend upwards, you have to be careful. The market will more or less do what Tesla did the last two weeks and just go uppy as weekly puts expire worthless.
And there will be no real sign of anything fundamental that should stop the train. Everyone will flip bullish for one reason or another (mah 200 DMA, meh trendlines, moh 76.321847234% Fibonacci) and it'll seem like it's time to get back to the good old days of 2021.
But it's not 2021. It's 2023, and everything is broken. Summer is going to be harsh, and Autumn will scare you.
And then the Chinese Communist Party will be destroyed by Wuhan Pneumonia seemingly overnight, and all the plans will be interrupted.
My advice to traders is to just risk a lot less and try to keep your risk within your winnings as much as possible. Also, if you really do see a black swan with China that crashes markets, don't buy that dip. Not even a scalp. It won't be like COVID hysteria was with 1,000 point up and down swings on the Dow this time. Everything will just gap down and stay down.
Liquidity will be a precious commodity.
One thing I've learned is that people never believe in what they think can't happen until it's unfolding in front of their face. Then they come back and are like "Wow it really did happen!"
Even I am subject to that flaw, because the length of time things take to unfold makes actually believing you are right very, very difficult.
That being said, I believe that we're looking at overall feverish bull market hysteria heading into May.
But what happens starting in May and heading into July is very likely going to change everyone's lives forever and ever.
הערה
Thank big Jerome and the FOMC for the pre-earnings pump, I suppose.Non farm payroll tomorrow and Jerome's Jaw on Tuesday.
I have reservations there's time for Google to $85 now, but I still think that monthly microgap would be a strange thing for the algos to leave behind to target _after_ the big pump.
Tough to trade. Sit on your hands and if it runs away upwards, feel nothing.
הערה
Today's big dump following the FOMC stop raid is a good indication that 80s might actually come.These plays are effective for the MMs because they give a dip to buy when it's actually a short-or-flat situation.
הערה
This one's a toughy, but imo puts at GOOG $110 FOMC tomorrow. Time horizon: end of April to trade <$80.
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