Bezos v. Madeira. No, it’s not a boxing match; it’s a fight between Amazon (AMZN) and Wal-Mart (WMT). Can you say “Prime”? (July 13, 2015)
Amazon ( NASDAQ:AMZN ); the company reports earnings a week from this Thursday, that’s July 23rd after the market, after the bell. This Wednesday, day after tomorrow, they’re holding “Prime” day, that is more deals online than “Black Friday”. The stock’s up on that, it’s a pretty big deal. Wal-Mart ( NYSE:WMT ) is coming after Amazon ( NASDAQ:AMZN ), which frankly, good luck with that. My personal bet is on Amazon ( NASDAQ:AMZN ), so is the markets.
Wal-Mart ( NYSE:WMT ) is still in a downtrend. You may say, “Well okay, this is the bottom and now I want to buy Wal-Mart ( NYSE:WMT ).” That would be fine if you did that, but just know that there is absolutely no indication that this is the bottom. Apparently Wal-Mart ( NYSE:WMT ) is having a war of words with Amazon ( NASDAQ:AMZN ). Again my bet would be with the bald guy with the newspaper on that.
But the stock is still trending lower, below the 50-day moving average and Wal-Mart’s ( NYSE:WMT ) going to be offering all kinds of deals on their website and you don’t have to be a “Prime” member to get those deals. My question to you would be, and this is a serious question that requires a serious answer. When’s the last time you’ve been on Wal-Mart’s ( NYSE:WMT ) website, verses when’s the last time you’ve been on Amazon’s ( NASDAQ:AMZN ) website?
Also, think about this, lets say you’re going to buy something on the off chance, an unlikely chance that you’re going to buy something from Walmart.com? What are the chances that before you do that you might check over on Amazon ( NASDAQ:AMZN ) and see if they have the same thing? And then of course if you’re a “Prime” member you get free shipping.
The bottom line is this, Amazon ( NASDAQ:AMZN ) has been drifting sideways for quite a while. Technically this is in a really good position. Again, we’ll just compare the two, this is like a multi year really, really, choppy cup and handle pattern. If this was a cup and handle that I bought somewhere I would definitely take it back to Williams Sonoma, or Bed Bath & Beyond, whatever.
This is a really, really sloppy pattern but you can see what’s been happening. The stock had essentially been consolidating for over a year, broke out on heavy volume, and not it’s not looking back. On the other hand Wal-Mart ( NYSE:WMT ), that was then, this is now. No thank you. Take Wal-Mart ( NYSE:WMT ) all you want, good luck with that, I’m going to take Amazon ( NASDAQ:AMZN ). Watching how it reacts after their earnings report on Thursday. But frankly, right now I’m looking at this as the momentum trade.
If the market stays strong I want to own this stock going into earnings. And then depending on where it is prior to the earnings numbers, my bet is this is going to be higher; as will be Netflix ( NASDAQ:NFLX ) before their earnings, which are this coming Wednesday. But I want to be long these strong stocks going into their numbers. Then prior to the earnings release I can decide whether I want to sell, or whether I just want to hold over earnings, or whether, and this is the more likely scenario, I’ll probably split the difference, sell some, take some profits, and then maybe hold some over just because I happen to like the company.
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