AMZN has been a position that we've been very patient with, there was a large, loose, trading zone and it really made for the perfect area for price to gravitate toward and create a distribution area, I had 3 initial targets for phasing in to AMZN and they were > (greater than) $282.50, the biggie above the range of >$287.50 and the most obvious being the psychological magnet of $300 as a centennial number.
I like AMZN as a CORE short position or a longer term trending position, I prefer not to use leverage with this kind of a position, it's more of a trending (less maintenance) position in my view.
I find the area it is in right now and the general position to be compelling, especially as a new position, I think it's a beauty, it seems a bit hard to buy a stock like this on a break out near highs, but it's actually where you have much less risk, a stop can be placed a bit above the most recent highs and you have an excellent Risk:Reward ratio.
I "may" add to the AMZN short "if" I can get a little upside price concession to make it a better entry, but that's because I already have a largely filled out position in place.
Charts...
Considering the size of the range, the time AMZN has spent above $300 is actually quite reasonable, large equity funds can't sell multi million dollar positions in a day or start large shorts in a day, they need time and there's a certain proportionality you'll notice after seeing enough charts.
3C told us it was likely AMZN would head above that large trading range with a positive divergence and since it has, this 2 hour chart shows how sharp the leading negative divergence has been, it looks like very strong, extreme distribution which has really pinned AMZN around that level as supply is out weighing retail's ability to produce enough demand.
The 60 min chart is more detailed, but the same finding, the second "barely" higher high sees a MUCH lower 3C reading.
On a 1 min. chart I don't hold out great hope for upside price concession to add to an AMZN short position in to slightly higher prices as it reduces risk and allows more shares to be added, but there is some small intraday positives or close to it.
The X-Over Screen is meant to allow the use of moving average crossovers, but filter out the whipsaws with an additional custom indicator added in the middle window and RSI (Wilder's) as a 3rd condition, all 3 have to be true for a long/short, but often we find other signals earlier, this is good confirmation though.
There was a long crossover in red that was not confirmed by the other two indicators and then one in white that was confirmed by all 3.
Right now the Price averages are giving a sell/short signal, the custom indicator isn't yet, but very close, as a long position with 2 of 3 out of place, I'd have exited the long. RSI is giving a clear negative divergence as well as moving under 50 or the mid point.
My Custom Trend Channel has held the ENTIRE move since the breakout above the range (based on closing prices) and now the channel's signal is a close below $297.40.
Obviously the channel shows the change of character in price momentum.
We also have daily Bollinger bands pinching right now indicating a highly directional move is coming, we saw that right before the breakout above the range, but back then we had a positive divergence suggesting the breakout to the upside, now we have significant negative 3C divergences.
I bring AMZN up because I really like it and I really like it HERE as far as position and timing which is just as important as stock picking.
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