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After the release of Google's financial report, its market value evaporated by nearly $500 billion, and analysts expect the stock price to maintain a range-bound fluctuation in the short term

According to CNBC, after the release of Alphabet's third-quarter earnings report, the stock price fell more than 12% to $285, with a market value shrinking by nearly $500 billion. Despite Google Cloud's revenue growing 103% year-over-year, the market is still focused on earnings per share falling short of expectations and the negative free cash flow amid ongoing investments in AI infrastructure.Mike Khouw stated in a CNBC column that the fundamentals of Alphabet's core business remain intact, but a quick rebound in the short term faces two obstacles. First, multiple institutions have downgraded ratings, target prices, or future earnings forecasts. He pointed out that historically, stocks that have experienced concentrated downgrades tend to underperform the market or trade sideways in the following 30 days, and institutional rebalancing can also limit upward momentum. Second, the gap down after the earnings report further damaged the technical pattern.In terms of technical indicators, Alphabet's RSI has dropped to just above 20, and the MACD sell signal has strengthened. However, Khouw believes that the stock price nearing the 52-week low of $270.70, combined with an extremely oversold condition, may limit further declines.In terms of trading strategy, Khouw suggested using a short straddle options strategy to cope with the expected range-bound volatility. He believes that continued selling in the overall market poses the main downside risk, while unexpected positive news driving the stock price up quickly could threaten the strategy's short call option side.
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