Alphabet technical breach below 0.786% Fib level sets stage for further downside
GOOGL price breached key Fibonacci support
Alphabet Inc. stock continues to trade lower this week as investors digest the recent pullback from May highs.
On Tuesday, GOOGL dropped 1.9% during regular trading hours, falling from an intraday high at $168.5 to a low at $165.3. This decline broke below the 0.786% Fibonacci level of the recent bullish range, marking a key technical breach. However, the stock managed to recover slightly by the close, ending the session at 166.2 just above that same 0.786% mark.
- GOOGL price breached key Fibonacci support before staging weak recovery
- Daily RSI approaches bearish territory as trend momentum continues to deteriorate
- Short-term outlook turns defensive unless GOOGL reclaims retracement levels
The weak intraday recovery reflects a fragile sentiment, further confirmed by bearish RSI readings. On hourly timeframes, RSI is already in bearish territory. More concerning is that the daily RSI has now drifted close to the bearish threshold, which raises the risk of a broader trend reversal if downside pressure sustains. Should the daily RSI confirm a move into bearish territory, the current bullish outlook would give way to a more prolonged corrective phase.
GOOGL stock price dynamics (Feb - May 2025). Source: TradingView
As of premarket trading on Wednesday, June 4, GOOGL showed a mild recovery, ticking up 0.33% from the previous close to trade at 166.8. This bounce pushed the price slightly above the 20-day EMA, but the weekly loss still stands at 2.65%, reflecting the weight of the recent selloff.
Alphabet faces critical test as bullish structure risks breakdown in June
From a structural perspective, the next major test lies at the 50-day EMA at $164.7. A firm closes below this level would likely expose the lower bound of the current bullish dealing range at $163.0. A break below $163.0 would not only confirm a shift in market structure but also signal that sellers are taking control of the trend in the short to medium term.
To re-establish upside control, GOOGL must attract buying pressure during regular trading and reclaim previous resistance levels. The initial target sits at $168.5, which aligns with the 0.618% Fibonacci retracement level. Beyond that, a move toward the 0.5% level from the two-day high would be required to restore a more confident bullish outlook. Until such retracements materialize, traders are likely to treat rebounds as opportunities to sell into strength.
Alphabet stock dropped 2.3% to retest the 100-day EMA support near $167.48. The decline followed renewed bearish sentiment ahead of the U.S. court ruling.
