Alphabet stock gains premarket as buyers defend uptrend despite new AI lawsuit

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Alphabet stock rebounds to $337.5

Highlights

Alphabet gains 0.46% premarket after rebounding off Trump-driven midweek tech weakness
Legal noise around AI summary lawsuit shrugged off as buyers defend uptrend structure
GOOGL stock RSI above 70 as price rebounds on 1h 20 EMA to retest the $340.5 record high

On Wednesday, the profit-taking move on GOOGL continued, dropping the stock by 2.9% from its recent record high of $340.5 to an intraday low of $330.5. The selloff followed comments from President Trump targeting credit card lenders. He stated that firms charging interest rates above 10% would be acting unlawfully. That statement triggered weakness across financial stocks and spilled over into big tech, as risk appetite briefly faltered across the Nasdaq.

Alphabet price chart (Dec 2025 - Jan 2026). Source: Tradingview

Alphabet's rebound later in the session came on rising trading volumes, reflecting strong dip-buying appetite. The move higher also came despite the announcement of a new lawsuit against Google by Penske Media Corp. The suit alleges that AI-generated summaries in Google’s search results are reducing traffic to websites like Rolling Stone and Variety. However, Alphabet’s legal team responded quickly, filing a motion to dismiss the case and labeling it as “legally defective.”

GOOGL shrugs off Trump credit remarks and lawsuit headlines to extend rebound

The market appears to be brushing off legal noise and focusing instead on Alphabet’s strategic advances. Its custom Tensor Processing Units and the growing influence of Gemini AI models have deepened its competitive stance in machine learning infrastructure. The partnership with Apple further reinforces future growth prospects, especially as investors price in easing monetary conditions after the latest soft inflation print. Those macro and micro tailwinds continue to drive demand for GOOGL shares.

GOOGL RSI above 70 flags momentum risk as price nears all-time high breakout

Technically, the 20 EMA on the 1-hour chart is providing a short-term inflection point for price action. The ongoing bullish pressure above that level may fuel a renewed breakout beyond the recent all-time high of $340.5. RSI readings on both the 4-hour and daily timeframes are already above 70, reflecting strong momentum but also heightening the risk of sharp intraday moves as traders respond to short-term overextension.

Failure to sustain a price above the 20 EMA would suggest intraday weakness, potentially exposing the stock to a drop toward $328.8. That level marks the lower boundary of the recent upward sequence and could attract renewed buying interest if tested. However, a bearish close below that zone would interrupt the stock’s multi-day uptrend and reset the near-term structure.

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