As a rule, I don’t recommend new chart-based trades when a company is within two weeks of reporting earnings. However, it’s still important to understand where the charts of the market’s biggest stocks stand heading into their reports — especially with two “Magnificent Seven” components set to release results this evening. With that in mind, today we’re taking a technical look at Alphabet (GOOGL) and the key price levels and patterns that could shape its next move. As you may recall, heading into its late April earnings report, GOOGL had already rallied about 30% off its low just a few weeks earlier. That wasn’t unique. In fact, many large-cap growth stocks had posted even bigger gains following the March 31 pivot low. In other words, the setup didn’t appear especially bullish—the stock was already extended and overbought. As we know now, however, GOOGL gapped higher after earnings and extended its advance to roughly 410, where it ultimately peaked. Since then, the stock has lost its momentum, falling about 15% from its all-time high. In the process, it has completely filled the post-earnings gap, and sentiment has shifted noticeably over the last several weeks. Ironically, despite all that volatility, GOOGL is now trading near the same 350 level where it stood three months ago. Looking at GOOGL from a slightly different angle, it’s clear just how important the 350 level has become. It acted as resistance in early 2026, served as the launching point for the post-earnings gap in late April, and has now been the area around which the stock has oscillated for the past six weeks. Importantly, all of this has taken place above a rising 200-day moving average. That longer-term line will be critical to watch if the stock reacts negatively to earnings. The last time GOOGL traded below its 200-day moving average was during the February-May 2025 correction, when the stock ultimately fell 32% from peak to trough. While moving below the 200-day didn’t cause the decline, it became part of the technical deterioration that unfolded. Today, GOOGL still sits about 7% above its 200-day moving average, now near $322. That leaves the longer-term trend intact, but it also makes the location of that support level worth keeping in mind as investors digest the earnings report after today’s close. Since the April 2025 lows, GOOGL has been one of the strongest performers within the MAG7. This relative strength chart shows that whenever GOOGL outperformed the MAGS ETF, both the stock and the ETF tended to advance at a healthy pace. Conversely, when GOOGL’s relative performance faded, MAGS generally continued higher, but at a noticeably slower rate. More recently, GOOGL has weakened on both an absolute and relative basis, coinciding with the loss of momentum in MAGS over the last few months. Needless to say, a renewed period of outperformance by GOOGL would be a positive development not only for the stock itself, but for the MAG7 complex as a whole. Most importantly, though, the headlines and guidance are only the starting point. The market’s reaction is what matters most—and not just in the first few minutes after the release. An earnings gap that remains open, whether up or down, signals strong conviction behind the move. On the other hand, a gap that quickly gets filled suggests the initial reaction is being rejected, a development that can often lead to a more sustained shift in momentum than many investors expect. — F rank Cappelleri Founder: https://cappthesis.com DISCLOSURES: None All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
