Google’s stock over the past two years has been marked by fairly predictable behavior.

There have been three price surging movements:

1. September ‘04 – November ‘04
2. April ‘05 – July ‘05
3. October ‘05 – December ‘05

…and three periods of trending sideways a.k.a. consolidation periods:

1. November ‘04 – May ‘05
2. July ‘05 – October ‘05
3. January ‘06 – Today

The most recent consolidation period which has yet to complete is already warning of a major movement that will occur sometime in the near future. I am predicting this movement to come sometime in late October or November when the markets begin their end of the year rally.

However, I would not recommend jumping in head first until the signal to buy is given. The technical analysis pattern forming is a symmetrical triangle which is almost looks like a coiled spring ready to explode. Each month this spring winds itself tighter and tighter until the release occurs.

From looking at this pattern the stock could technically break out in any direction which is why it is important to wait for the verification of direction before buying or shorting this stock.

You may lose some percentage points, but you will ultimately gain a bulk or “sweet spot” of the trend when the breakout finally occurs. It is extremely rare to find anyone who can consistently call the top or bottom of any stock in the market so I would recommend that you not try it.

The key Google trading range to watch would be between $375-$425 per share. A breakout above or below these levels on a weekly chart with good volume could mean the move is made with conviction.