1/24/13 -  GOOG is back on the block and heading HIGHER! AAPL is damaged goods for now so the money is shifting back to GOOG and other stocks like RIMM, FB, ISRG etc.  Based on today's action, it's looking like GOOG will make an attempt to head to $800 and beyond, but REMEMBER, this stock is part of the S&P 500 so with out that index powering higher, it will be hard for GOOG to counter trend it so keep an eye on the index to help you gauge momentum.

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1/23/13- Success on the Calls!

Sold at the top of the days range and then GOOG slipped lower the rest of the day. With AAPL getting whacked, GOOG is also down in post market. The puts will be a bust most likely but I will see if I can squeeze off a lotto trade for Friday to make up for those.

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1/22/13 - GOOG BEATS and the stock jumps $35.33 in after hours! We need the rally to continue tomorrow to make the Lotto trades a big success.

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1/21/13 - Tomorrow is the big day for GOOG. This time there better not be some BS early release like last time. Typically I wait until the end of trading to get my position on but I am not going to do that tomorrow. I am going to get in when trading opens to make sure I do not get missed opportunity again.

Last week GOOG sold off quite a bit ahead of earnings and usually the opposite is the case. Because the stock is down, the puts are heavily packed with premium making profit windfalls less; however, if they do beat this quarter, we could get a massive short covering rally! We will have three days of trading to work these plays out and if GOOG misses and then AAPL does too, we could see a very nice drop into Friday.

I am going to go OTM on my calls this round and ITM on the puts. If you go OTM be sure to stay at 5% or less for your strike price because GOOG is controlled in its movements to the upside, but if the stock fails, I would expect a drop of 10% maybe even more.

The JanWk4 options have large open interest at $720 on calls and 690 on puts as well as DOTM 650 puts.

The weekly chart is in conflict with the daily and this could be the beginning of a long term sell off back to the 200MA if they miss again.

The monthly chart shows GOOG has been in a sold 4 year up trending channel. With my long term trend lines intersecting at the current sell off, we could be in for an interesting move. The last time GOOG busted out of this channel, it made a 4.5 month run up $181.00 before topping out and pulling back 55% of that run. If this happens again, we could see GOOG head to the projected $1,000 historic price point this year. Wow, that would be amazing! So, if the stock beats, and holds over $740.00 then GET LONG and stay long!

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1/14/13 - GOOG failed to close over $745 and this week it's been heavily sold off down to the 12MA. Thur/Friday did not produce a good trading opportunity so now I am looking at this weeks action since this will be options expiration Friday. This weeks selling is setting up for a good lotto trade opportunity this Friday.

I have been watching the options action and as you can see below the volume shift in the puts was building but now that GOOG has dropped under my lowest strike, the volume has actually dried up on the weekly's? It's looking to me like the speculators are going for the Feb Wk1 options at the 725 Put strike. The JanWQk4 Puts are getting a lot of open interest at $700 and $690 strikes suggesting GOOG is heading lower.

The big challenge trading GOOG for Jan earnings is the cost of the options so you need some big bucks to speculate on these options; therefore, these trades are not suitable for everyone and you have to decide how much risk you want to take.

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1/9/13 -  GOOG is attempting for find some buyers off the DOJI from Monday. So far $725 is holding ground and the bulls are still interested as I predicted; however, GOOG now needs to take out $745.00.

I will looking for a weekly lotto play tomorrow for a nibble at the action, but my bigger plays will be just before earnings.

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1/7/13 - No follow through today with GOOG and the daily chart shows a Doji which is inside Friday's bar. This means the stock is capable of making a move in either direction so that is why I will just wait to see what direction that will be.

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1/5/13 - Money is moving out of AAPL and looking for a new home; and that home appears to be FB and GOOG.  While AAPL was getting whacked back down from a retest of $555, GOOG was hitting the gas putting on a solid gain Friday. The charts are strongly suggesting GOOG is about to eclipse the massive drop it took from last quarters earnings miss. We still have to be concerned because a climb back from a cliff drop this stock suffered is more of a vertical one vs. a hike up the mountain side.

I will be watching for trading opportunities as we head towards earnings on 1/22/13 and this particular quarter is going to be explosive. If they miss again it will no doubt be a massive drop and long term correction coming; however, if they make an impressive beat then watch for a run to $1,000 over the next 12 months—GOOG must hold $725 to keep bulls interested.

Typically GOOG loves to announce earnings the day before options expiration, but it always reports after in January's so options are going to be more expensive if you go out to Feb and more risky if you do the weekly options.

I always like to watch the Open Interest in options as we approach earnings to give me clues where the smart and dumb money are placing bets.

Profits Up!

The donFranko

Below I will start tracking the options as we move forward towards earnings.