AMZN Update

GOOG and some others are coming as well.

AMZN is a really nice example of our philosophy of, "Let the trade come to you". We don't want to chase trades, we want an idea of what we'd like to see that would give us an edge in the trade and then see if it happens (of course this is based on some evidence in the first place and continues to be). In this manner we get the best entries with the lowest risk and very high probability trades, the interesting thing about AMZN is that the long / call position is only a minor trade in a bigger trade that will be short and we are using the upside to let the trade come to us for this larger short sell trade, this comes back to our, "Take what the market offers" concept, if the market was offering us a ride higher to our final destination in AMZN, the probabilities looked good, why not take that which the market was offering?


Charts...

 The yellow gap area is really the minimum target I'd like to see on the upside as far as adding back the equity short shares that were closed yesterday (half of the position to add at better levels) and possibly enter an options trade if it seems like the right tool and timing. Today AMZN went from the red column to a nearly +1.5% gain, this is not like recent weeks/months where assets moved 0.20% and everyone lost their minds in a panic that the market was moving against them (not here), so this is a good reversal and above resistance with a possible Hammer Candlestick (upside reversal signal).

 THIS IS NOT 3C, but I wanted to show you what a Rate of Change Indicator applied to price could do, it called a bottom and the recent consolidation, you can apply it to price, other indicators, as a matter o fact I think OBV (On Balance Volume) is a horrible indicator, nut apply ROC and use those signal, it actually works here and there. So keeping it simple works wonders.

 This is the 3C intraday chart.

 The more important 5 min chart has a strong leading positive divergence so I think we are probably good with the April Calls in AMZN.

We even see a little of this on a 30 min chart, but remember the bigger trade is short, we are just waiting for AMZN to come to us.

So far, so good.