Amazon Stock: Something Rare Is About To Happen

I wanted to write a post this Sunday evening about a couple things I’m seeing in Amazon and why this may be your last chance to get in before this thing takes off if you haven’t. I’m going to discuss what I’m seeing, how rare it is, and show you examples from other names AFTER this setup played out, and I’m going to discuss what could spoil the party. Lastly I’m going to post a couple trades you can put on free still that can play Amazon short term and long term.

Let’s start with technical setup. I posted 2 charts on Twitter yesterday

The proverbial golden cross. This is a very popular trade when the 50 sma crosses the 200 sma on the daily. Amazon is about to do this on the WEEKLY which is a far more significant trade. I have some examples below from other names and what they did after this cross. I will discuss those down below. Here though you see a beautiful flag on the weekly, the name is a coiled spring going sideways for 7 weeks since earnings, and now it sits $10 from all time highs and a 3+ year base breakout. There is a saying the “longer the base, the higher the space” and that refers to the power of a move on a breakout based on how long the consolidation was. In the case of Amazon, no megacap has consolidated this long before a breakout. The circle shows the yellow line(50 sma) and the green line(200 sma), the 50 should cross it this week or next.

The Quarterly chart which on a close over 172 this friday would be the highest close ever in this name for a quarter. You can see the previous attempts a couple years back never closed over 172. A highest quarterly close is not bearish.

So let’s look at other names who’ve made this 50/200 weekly cross and what came next