Insights

Is it the end of Google search?

By Paul Reid

16 May 2024

google search end

You may have heard that more and more people are turning away from Google as their search provider and choosing Microsoft’s Bing. These rumors began to appear after Google’s Bard/Gemini released some rather embarrassing AI-generated images that caused the stock to plummet.

Before the controversy, GOOGL was holding at $144 (USD), but within a week the stock tumbled -7.64% to $133. Did this mark the beginning of the end? Is it the end for Google search?

Google search is far from ending. In 2024, Google’s share of the global search engine market was 91.5%, a slight increase from 2023, where Google held around 81.95% of the market.

As for GOOGL, after the brief bear market, the bulls took over and the stock price rocketed to $172, an all-time high for Alphabet Inc. Google is not only surviving the embarrassment of Q1, it continues to grow, and it has big plans for the future. Let’s explore Google and the potential trading opportunities on the horizon.

What Google is planning

Despite the pessimistic rumors, Google's influence on our daily lives remains undeniable. However, the tech landscape is slowly shifting, and Google's dominance is being challenged. Alphabet Inc. CEO Sundar Pichai's strategy revolves around integrating AI into every facet of Google's operations, a vision he has championed since 2016.

Pichai emphasizes the importance of AI in Google's future. He uses AI in personal anecdotes, highlighting its practical benefits, such as using Google Lens for homework assistance. His approach underscores Google's commitment to making AI an integral part of everyday life.

Pichai's leadership is characterized by his ability to focus on long-term goals amid industry upheavals. Regular interactions with Google co-founders Larry Page and Sergey Brin help him maintain a broad perspective essential for navigating a company of Google's scale.

GOOGL technical analysis

You don’t need a long list of indicators to see the current GOOGL trend. Open the Exness demo account from your Exness Personal area and let’s do some forecasting.

First up is the Moving Averages. The Moving Averages tool indicates a strong buy signal across various periods. Simple and Exponential Moving Averages (SMA and EMA) for 5, 10, 20, 50, 100, and even 200 periods all show buy signals. This is a clear indicator of a strong upward momentum in the stock price.

Technical Indicators

Several other technical indicators also support the buy signal.

  • Relative Strength Index (RSI): 66.35, indicating the stock is not yet overbought.

  • MACD (12,26): 0.84, suggesting bullish momentum.

Volatility

  • The Average True Range (ATR) is around 0.90, indicating lower volatility, which can be favorable for stable price movements.

Pivot Points

Using pivot points can help identify potential support and resistance levels.

  • Support Level: S1: $170.51

  • Resistance Level: R1: $172.65

Indicators to use when forecasting GOOGL

Moving Averages

  • Add Simple Moving Averages (SMA) for 10, 20, 50, 100, and 200 periods.

  • Add Exponential Moving Averages (EMA) for 10, 20, 50, 100, and 200 periods.

These will help you track the stock’s price trends over different timeframes.

Relative Strength Index (RSI)

  • Set RSI to a 14-period to gauge the stock’s momentum and identify overbought or oversold conditions.

Moving Average Convergence Divergence (MACD)

  • Use the standard settings (12, 26, 9) to identify bullish or bearish momentum.

Ultimate Oscillator

  • Set with parameters (7, 14, 28) to measure price momentum across different timeframes.

Candlestick Patterns

  • Look for common patterns such as Bullish Engulfing, Bullish Hammer, and Doji patterns. These can signal potential reversals or continuations.

Pivot Points

  • Add pivot points to identify potential support and resistance levels. Use the standard pivot point calculation.

Bollinger Bands

  • Use these to visualize volatility and identify potential breakout points.

Fibonacci Retracement:

  • Add this tool to the chart to identify potential support and resistance levels based on historical price movements.

By combining some of these indicators and tools, you’ll create a well-rounded technical analysis chart that provides insights into price trends, momentum, volatility, and potential reversal points.

Tomorrow’s Google

The future of Google, especially its core search function, is intertwined with the evolution of AI. While generative AI is transforming search, Google remains dedicated to maintaining high-quality search results by providing diverse sources and addressing concerns about AI-generated content.

The recent launch of AI tools like ChatGPT has put Google on the defensive, prompting questions about its ability to innovate and adapt. However, Pichai's methodical and visionary approach aims to leverage AI's potential to maintain and enhance Google's position.

As AI continues to reshape the tech landscape, Google’s strategy under Pichai’s leadership is focused on innovation, adaptability, and a clear vision for the future. The integration of AI across Google's operations signifies the company's commitment to leading the next wave of technological advancement. However, the rapid pace of AI development and competition from rivals like Microsoft necessitate a continuous evolution of strategies to sustain its market leadership.

As Google rolls out new AI features and responds to competitive pressures, traders and investors closely monitor these changes. The introduction of AI tools by competitors has influenced market sentiment, leading to fluctuations in GOOGL's stock price. The ongoing advancements and strategic responses by Google will play a significant role in determining its stock performance and market position in the AI-dominated future.

Conclusion

Rumors can influence market sentiment, but if the source of the price dip doesn’t have long-term implications, big companies tend to bounce back not long after the dust has settled. The assumption that Google’s biggest money-makers (search and YouTube ads) will fall because of AI is flawed.

While Bard/Gemini had a rocky start, the performance is evolving and will likely become an even bigger part of our lives in the coming months and years. Unless the Worldwide Web goes down permanently, Google has a big place in our future and the stock prices will reflect that. Just remember that market sentiment will react to minor challenges, so don’t expect an unbroken bullish trend.


This is not investment advice. Past performance is not an indication of future results. Your capital is at risk, please trade responsibly.


Author:

Paul Reid
Paul Reid

Paul Reid is a financial journalist dedicated to uncovering hidden fundamental connections that can give traders an advantage. Focusing primarily on the stock market, Paul's instincts for identifying major company shifts is well established from following the financial markets for over a decade.