Insights 
VT 
Alphabet’s stock has decreased by more than 7.50% after Apple’s Eddy Cue mentioned a drop in search and browser usage since April. Apple is now considering adding AI-powered search features to its browsers, potentially affecting Alphabet’s revenue-sharing agreement for Google searches on iOS devices.
Following this news, Alphabet’s shares fell by $13.65, an 8.41% decrease, bringing the price to $149.50. The selloff caused the stock to dip below both its 50-day moving average of $160.66 and the 38.2% retracement level at $159.79 from the rally starting November 2022 to February 2025. From its peak, Alphabet’s stock is down by 27.5% and has lost 20.71% this year.
Technical Support Levels
Despite staying above its 2025 low of $140.53 from April 7, important technical support levels are at $147.22 and $145.20. The steep drop underscores growing concerns as AI technologies, such as ChatGPT, impact traditional search usage. Alphabet faces challenges as it adapts with its main business under pressure.
As we examine the details provided above, it’s clear that a sharp shift in sentiment toward Alphabet has triggered notable technical weaknesses in the stock. The decline was provoked not simply by a drop in value, but by a trifecta of price action crossing under key support indicators. The stock first broke beneath its 50-day moving average, an often-watched marker of medium-term trend direction. More materially, it slipped under the 38.2% Fibonacci retracement from its two-year rally span—often viewed by traders as a natural first line of defense in a pullback.
When price breaks under both levels simultaneously, and particularly when accompanied by a decline of more than 8% in a single session, it tells us there’s no casual interpretation to be had. According to recent behavior, the stock has lost over a quarter from its highs and nearly 21% on the year, effectively erasing most of the optimism that had built up around its earlier rally.
Traders Need a Decisive Approach
There is still some bounce room, with levels at $147.22 and $145.20 acting as near-term supports. A small climb might occur near these points, possibly pausing the downside momentum temporarily. However, if pressure continues—especially if sentiment keeps wavering—the next testing area will likely be around the early-April low just south of $141.00. Below that, we’d be retracing closer to longer-term foundational zones rather than transient breathing spaces.
What this means going forward is that traders need a decisive approach. We should be watching for whether the price retests the broken 50-day average from below, a move that might trigger short-covering or encourage fresh positioning on expectations of a partial recovery. If that re-test fails or volume thins, however, it suggests bulls are temporarily stepping away, and weaker hands are taking control. That usually favours directional trades rather than neutral ones.
There’s also the wider issue of revenue exposure tied to third-party partnerships. The uncertainty that surrounds moves by other firms to integrate alternative AI search functionalities might not be baked into expectations fully. If that stream is interrupted or restructured, forward earnings projections may have to be revised. When earnings paths shift, so too do implied volatility assumptions. We should not ignore that possibility. These changing conditions offer increased directional skews in option pricing—for sellers or buyers with a short-term time horizon, that opens up opportunity.
We wouldn’t necessarily chase the move after such a stark gap, but the possibility of a multi-day continuation lower still stands if initial recovery attempts stall above key resistance. Indeed, any attempt to reclaim prior levels must be backstopped by volume or news flow that restores conviction. Right now, that’s uncertain.
As directional flows react over the coming sessions, especially heading into the next options expiry window, focus should stay on volume-led shifts near $147 and $145. If those levels hold, a rebound might be probable, albeit muted. If they don’t, we’re likely poised for further retracement, perhaps even closer toward the 50% level of the previous rally, depending on macro factors.
Volatility assumptions will remain elevated, especially with headline risk present. In such conditions, defined-risk structures should be prioritised. Keep stops tight and bias toward setups with a clear asymmetric payout. We should remain cautious of whipsaw moves that may develop around key technical levels, especially with any further statements or strategic changes from the companies involved.
