Amazon Swinging Higher
High-quality technology stocks were down pretty hard
today. But second- and third-tier Net stocks made their move today. Among
them — Amazon.
Amazon
(
AMZN |
Quote |
Chart |
News |
PowerRating) may be of interest to intermediate-term traders who
are looking for stocks to add to their watchlists.
Bottom-picking is dangerous, and I certainly don’t advocate looking at AMZN as
anything more than a work in progress. Here’s what you should pay attention to
at this point. During the past two weeks, AMZN has broken above and pulled away
from its 50-day moving average. This is the first time it has traded above this
widely watched moving average for an extended period of time since December 1999.
Tuesday’s action follows through a short-term uptrend established in early August.
What may be shaping up now is some healthy sideways action which would
establish a base from which AMZN could launch from its lows. If this indeed
happens, watch for signs of accumulation. That is, up-days on volume surges.
When you see a series of such accumulation days occurring through the base-formation process, you know that there’s growing hope that an upside
breakout might someday occur. Your job is to be patient.
See you tomorrow,
Eddie
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