I classify AMZN as a ‘lunatic’ stock because it has been deliberately priced so that its institutional sponsors can manipulate it, sometimes violently and to their great advantage, with no interference from retail riff-raff. But it is also one of the few high-fliers that I actually like — a company that has methodically been building a stranglehold on retail that eventually will be nearly impervious to competition. (Just watch as Uber struggles in vain to steal a piece of Amazon’s delivery business.) Under the circumstances, it’s easy to imagine that the pattern shown in the chart is a consolidation — which is to say, a prelude to another powerful leg up. If so, the stock would trip a conventional buy signal at 542.90 (i.e., the green line); whereupon it would become a decent bet to reach the 571.84 midpoint pivot of the pattern shown, or even D=629.71.
That would add about 18% to AMZN’s valuation, presumably while leading the broad averages to new all-time highs. It is only because the charts of AMZN and a few other world-beaters, including Chipotle and Netflix, look so promising that I am hesitant to say that the bull market is over. That doesn’t necessarily mean these stocks will reach their D targets; indeed, they could fail at their respective midpoint or p2 pivots, well shy of being maxed out. But it seems reasonable to infer that at least a moderate rally lies ahead, with commensurate gains in the tech-heavy Nasdaq Index. Permabears should take note — or better yet, hedge their bets with a long position in this vehicle. It stands to be a high-beta gainer if there is yet life in a bull market that has been looking its age for quite a while.