On February 4, I first warned that Google was running out of steam and about to drop.

Then on February 9 I said this.

Google might go up another week – but not pass its trend line resistance at $400 (if it passed $400, I would bail out of my short). It might try to get above, but should fail and drop to $275 or less by summer – a 31% fall.

A month later Google dropped to $289. You would’ve made a healthy 23% gain.

So I hope you pay attention to what I say next about Google Inc. (NASDAQ:GOOG).

What I want to show you is a little timing trick that relies on the 20- and 50-day moving averages.

Every time the 20-day crosses under the 50-day, you sell shares short. And when the 20-day rises above the 50-day, you buy shares outright.

By following this strategy, you would’ve made 43% when the first bearish cross happened in late June of 2008 until the beginning of this year.

Later, when a bullish cross happened (in early January) you would’ve recently sold out of that position roughly flat.

But today, another short-sale signal was triggered by this technique.

Here’s your suggested play: Sell Google short and use a point above the moving averages (like $340) as your stop loss to protect yourself.

If Google takes another leg down (as this very basic system shows it should), we could see Google shares trade for $250 per share.

And Rick Pendergraft sees Google continuing it’s search and advertising dominance online even against the possible combination of Yahoo and Microsoft. He says, “Microsoft and Yahoo! would create a virtual monopoly in instant messaging and would put them in a more dominant position in email service and the on-line news arena. But what else would the merger bring to the table?

Legislators are jockeying to voice their opinion on the potential merger. Most of them are concerned about potential unfair advantages for the merged company.

I don’t see it.

As I stated above, the combined entity of Microsoft and Yahoo! would not be dominant anywhere they aren’t already. Google would still be dominant in the search engine and ad revenue areas. I understand the posturing by Google and their CEO, but I for one don’t see the need for concern.”