Monday, November 26, 2012

AMZN - on the lookout for some trouble.


Its cyber Monday and the stock is only up $2...what gives?
Actually, I guess those with good enough timing to get in near the 200day moving average near $220 cant complain with the stock trading near $242. But AMZN is in an intermediate term bear market...so longs need to be wary here.
Technically, there was a short term buy signal on November 19/20th (along with many other stocks) that may have more legs. But, as the saying goes "Buyer Beware". There are 2 warning signs looming after the latest 10% bounce...first, the 50day moving average sits just above at $243...second, the 61% Fibonacci retracement level of $245 (measured from the Sep highs to the Nov lows) is a formidable foe for any bear market bounce.
If looking for short exposure put this one on your Christmas list. First level of support on the downside near $235 followed by the gap near $227...while another test of the 200day ma will be very interesting. Stops according to your risk tolerance but a higher closing high around $247.50 will likely be a spot for many.
 

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