AMZN Update

Friday I updated AMZN (actually twice) which is a position I like, I think it's an ideal position for a phased entry.

My thoughts on Friday were two-fold..

"Ideally AMZN looks the best above $269"

 "if I had time I'd probably add to the AMZN short opened this week I believe it was. I'd prefer not to be at a full position yet until the market is in line as well."

The market being in line as well is for pretty obvious reasons, the market is responsible for probably somewhere around 65% of the gravitational pull on any given stock on any given day (of course excluding stock specific events), simply said, most stocks move with the market so having the market in line with the individual position is a no-brainer.

The reason I'd prefer not to be at full-size in AMZN yet (as of Friday) is because of this...

 That resistance zone is too defined, it's too obvious of a target, and it leads to new highs, all of that leads to increased demand, price, etc, everything that is useful in putting together a short position or selling a long one if you just happen to be dealing with positions that are not in terms of 100 lots, but in terms of percentage of outstanding shares.

There are a lot of other reasons as well, I can't list them all here, that's why I wrote the first 2 parts of the 3 part article, "Understanding the Head-Fake Move", there are a lot of reasons. I'll be sure o get a link to those two articles up on the right side of the site so you can reference them. Look at the Industry today, retail, it's up about .30% so this move isn't about a strong retail sector, the sub-sector is up a bit over 1%, but that's because of the 17 components, AMZN and EBAY are the biggest and EBAY(-1.21%) isn't performing like AMZN. I have little doubt this move is all about predictability of technical traders and that clear resistance zone that would move them to action as well as hit existing orders. It wold also just be silly to leave that much money on the table because you didn't make a move above resistance (the bid/ask spread, HFT trading, locals' trading, volume rebates and that's not even considering the bigger picture)

 Volume spikes on a 1 min bar at 9:33 a.m.  the same time AMZN moves above that resistance zone, orders were piled up there, easy money for all kinds of Wall St. players.

Looking at the bigger picture this looks like a broadening top, I didn't include volume because it's kind of irrelevant in a broadening top, tends to be all over the place. Right about this area we are in now is the typical place a Broadening top fails, when they do from this area, they typically fail pretty spectacularly.

This is a closer view of a 15 min chart and about the area that trend #1 would  have move most of the market, 3C is in leading negative position as a 15 min chart "Can" as we have seen, confirm price in a single day, not even close here.

If we take a broader look at the same 15 min chart, there's an obvious change of character recently. There are charts that look much worse than this like the daily, but I'm not sure that's the trend we are targeting right now, but you should know that because it is part of the probabilities factor.

Looking at the intraday trade, the 1 min chart is not confirming either, it's starting to lead negative, actually, let me update this chart, this is what it looks like now since this last capture...

 Most current chart-1 min

Closer view.

The 3 min chart looks about the way it should considering where the 1 min is.

As does the 5 min chart.

So far the 1 min chart is moving the direction I'd expect and want to see, I'd like to see the others follow and I suspect as the 1 min is getting worse in a short period of time, they will follow and that's where I'd like to add to AMZN.

If I had to make a choice this second to add or miss the chance, I'd add no doubt. However I do prefer to have the strongest signals so in light of that, I'll be patient, but I like what I see so far.