The most basic of trendlines can be found on the Amazon monthly chart, below. After this recent post-earnings drop, the presumption is that this support trend will likely break and, at a minimum, reset Amazon’s long-term bull run. Of course, there is also the risk the support break morphs into a deeper bear pullback.
Much like the NFLX P YELP drops lower, though, we can see big money striking decidedly more cautious tone even with the rally in the major averages over the past week or so.
I would resist bottom-fishing Amazon for anything more than a quick one/two day flip with the downside risks still pronounced and the earnings quagmire not likely to have run its course yet.
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Thanks Chess,
Do you have a downside target?
$250, then $200 if that is lost.
My bet is it breaks. On strength I add cash short.
Looks like the investment committee meetings have ended and sell tickets are hitting the desks of one or more large institutions.
Here’s something that’s befuddled me.
The market leaders are going into earnings amid a broad market sell-off, reducing expectations – and they’re still getting clobbered (AAPL excepted). How is the broader market so resilient in the face of this? (And should we be shorting other market leaders into earnings?)