AMZN is quickly recouping the excesses of last Friday’s shakedown and remains an even-odds bet to hit the 885.19 target shown (see inset) within the next 7-12 days. The rally pattern is sufficiently clear that anyone who has held the stock as a long-term investment should considered writing some deep-in-the-money calls or buying puts if the target is reached. Yet another Hidden Pivot target has come into prominence at 859.49, since it neatly contained last week’s high. The target looks in retrospect to have been a promising short, given the precise interplay between the stock with p and p2 (click here for chart). Until such time as it is surpassed, however, our trading bias will be bearish. This is more than a little important, given the stock’s bellwether status as the dominant retailer in the world. ______ UPDATE (Mar 1, 11:08 p.m. EST): I’ve switched charts to show the less ambitious target at 875.20 that we’d been using. The picture speaks for itself with respect to the likelihood that the target will be reached. That said, it is perplexing that AMZN wasn’t in the vanguard of Wednesday’s outrageous rally. I suspect that portfolio managers decided to take a breather from the stock, confident they could buy any old stock without having to worry.
