Buying Amazon ($AMZN)? What’s your timeframe? – July 08, 2021
AMZN
Amazon ( NASDAQ: AMZN ); here’s the thing, we are looking at this, kind of zooming in here, this is a daily chart. You can see where we’ve got this squeeze here, right here, a nice little squeeze here. A breakout, this would be a typical Phase 1 move, a breakout from the squeeze, then a pullback.
We don’t know how far it’s going to go, it could go to here, it might just have gone to here and then go higher, we don’t know. But we are getting a little pullback here and the idea on this is, if this was the breakout down here then the Phase 2 move, that is the pullback after the breakout, it should not go back to below the breakout. In other words, the deepest it should go would be to test that breakout level and see if there are still buyers there. If there aren’t, it goes lower, you have got to get out, Elvis has left the building, you don’t want to be sitting around.
On the other hand, if the stock only pulls back a little bit like it did here and then finds some action, finds some buying action, then that’s a good thing. So you are buying the breakout, you are waiting to see how the stock does here. It’s finding some support, maybe you are going to buy the stock here, maybe not. Maybe you are saying, you know what? It hasn’t gone down that much, I think I will wait for it to move to a new high, then you are buying here, but you are at least hanging onto this. And then the stock runs higher and it’s all good in the hood. You are happy, happy, joy, joy, you’re happy.
However, what are you going to do now that the stock is so extended? Do you wind up selling? As we zoom out though, it looks kind of a good breakout. It is a really, really sloppy chart, but Amazon ( NASDAQ: AMZN ) always is when it is in a basing process. This thing has gone on for about a year, if I recall correctly, almost, about 10 months or so. This has been a basing pattern, you see, Amazon ( NASDAQ: AMZN ) did this here. The same thing, this is for 5 months, I don’t know what this was but if you bought here it was forever. Anyway though, finally we’re getting a nice breakout here.
If you look at the weekly chart, boom, this is a REALLY nice move to the upside. You can see my initial target is $4000.00, and you can say, well gosh, that’s sure a lot, not really, I have just drawn it, it’s like 8 percent from where it is now. That is kind of an easy projection to hit. As I look at this I see Amazon ( NASDAQ: AMZN ), on this time frame, it’s not a really good entry.
On a weekly chart I see this as, I still wish I had bought it last week but this is still going to work. So you just have to decide what your time frame is going be, because one thing I know, the stock is going to go up and down. It isn’t just going to be going up in a straight line or pull back. It’s going to be back and forth, so choose your time frame and then you stick with that time frame.
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