Friday, July 24, 2015

Amazon (AMZN) at Dual Resistance and Overbought Conditions. Why Not Own it Now? A Technical Perspective

I like as a company. I am a prime member and have their credit card. I appreciate the convenience of usually finding what I need at a good price without leaving the house and having it delivered free within two days. 

As an intermediate to long-term investor, I wouldn't mind owning stock someday - but that day is certainly not now.

Why? For technical reasons only, as the weekly closing price chart below shows, AMZN's share price has pushed up against dual channel resistance lines (solid and dashed red) and is at overbought conditions.  

Historically, as also shown on the chart, these conditions have not been favorable for investors. Declines after these conditions were encountered, some well over 50 percent, are denoted by red arrows.

click chart to enlarge

Not Investment Advice | Important Disclaimer: 
The content in this article, including the identification and discussion of any specific security (e.g., bond fund), is NOT meant to be and should NOT be construed and/or used as investment advice. This article is for general information and educational purposes only. Please read the Disclaimers  for in their entirety. The U.S. Securities and Exchange Commission website has guidance on selecting an investment adviser.

Financial Disclosure:
The author/publisher has no position (long or short) in AMZN at the time this article was written. This position may change depending on future price action.

 Base Chart Provided Courtesy of  Analysis and Annotation by JunkBond (all rights reserved)

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