We’ll continue to monitor AMZN’s vital signs closely, since, as I noted here earlier, the stock is unlikely to mislead us concerning the health and vitality of the global bull market in equities. The steady and seemingly unstoppable rise of Amazon shares is arguably a perfect analog for the mindset of the institutional buyers who have been driving this bull for the last nine years. It doesn’t hurt that the company is a true brick-and-mortar operation in the old-fashioned way — i.e., using a vast capital infrastructure that includes more than a hundred warehouses, some as large as a million square feet, in the U.S. alone; more than 150,000 employees; and delivery needs so far-reaching and urgent that they even keep U.S. Postal Service workers busy on Sundays.
So what does AMZN look like, technically speaking? The chart (click on inset) hints of a possible trend failure. Although the stock “should have” hit 1639.19 on the most recent upthrust, buyers sputtered out at 1617.54, well shy of our Hidden Pivot target. Yes, AMZN could turn sharply higher at any time, reaching the target in just a few days. But I am taking the so-far failure to do so seriously because a similar failure has occurred in several other noteworthy trading vehicles, most particularly the E-Mini S&Ps. There is also a corresponding rally in Treasurys, which, if it were to continue, would imply that the very big picture for investors has changed. To correlate this with AMZN, I’d suggest setting an alert at 1545.24, since a print at that price would turn the hourly chart bearish for the first time in nearly six weeks. _______ UPDATE (March 19, 8:32 p.m.): Sellers sent the stock plummeting 50 points in the early going, but AMZN ended the day in a 20-point short-squeeze that would trip a mechanical short sale at the green line (1549.17, stop 1561.01). Rather than risk $5000 on four round lots, I’ll suggest paper this one in order to stay closely on top of the trend. If the stop gets hit, it’ll be warning us to get out of buyers’ way — and not just in AMZN. Here’s a fresh chart.