By Gareth Soloway on April 19th, 2010 1:02pm Eastern Time
As I continue to trade based on technical charting, I look at past charts and am amazed at how well they truly work. One of these best examples can be found on Amazon.com, Inc. (NASDAQ:AMZN). The chart on AMZN, seen below, shows a move into the late 2009 highs. This high level at $146 also represents an all time high on the stock.
My reasoning for shorting this was mainly technical but I also used common sense. First, the double top all time high is always a great play. The second factor was the Kindle. The Kindle is in direct competition with the IPAD now, Apple Inc. (NASDAQ:AAPL) new gadget. With Amazon trading at all time highs, plus major competition in the works, it seemed like a no brainer.
Sure enough, the technicals gave the heads up, and the thinking process was true as AMZN has pulled back solidly to the $140.00 level from $146.00. Read the charts, they tell you the truth unlike the nonsense hype from Wall Street and the media.
Gareth Soloway
Chief Market Strategist
InTheMoneyStocks
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