In an uptrending market, the two main types of technical setups we buy for swing trading leading individual stocks are Breakouts and Pullbacks.
Over the past four weeks, Internet giant Amazon.com ($AMZN)
Because $AMZN has retraced just 9% from its July 2013 peak down to its August low, the daily chart still looks healthy. Furthermore, $AMZN continues to look great on its longer-term weekly and monthly charts.
In the 3-minute trading strategy video below, we briefly analyze the daily, weekly, and monthly charts of $AMZN. We conclude the video by showing you the ideal price level where a swing trader might consider buying $AMZN on this pullback.
For best viewing quality, press the “play” button, then click the icon on bottom right side of video player window to watch the video in full screen HD mode:
To learn more details about our trading strategy for buying strong stocks on a pullback, check out the former blog post titled How To Buy Strong Stocks And ETFs On A Pullback.
Conclude by taking a quick look at How To Quickly Scan For Swing Trade Pullbacks, a trading strategy video that shows you a quick and easy way to pick the best stocks on a pullback.
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Just an update on the potential pullback setup in $AMZN discussed in the video above.
As of the morning of August 27, $AMZN has broken support and is trading at new lows for the month.
If $AMZN convincingly closes the day at new swing lows, the setup is technically dead for now. However, this is no problem at all because the trade setup never triggered our buy entry (it would have needed to move back above its 50-day moving average).
Furthermore, the video remains a great educational summary of the factors we look for in pullback trades, regardless of the individual stock being used as an example.
Amazon (AWS) is hosting sites that has illegal content like mugshots.com as well as others. And is already listed in a class action lawsuit. This could cause earnings and the stock to go down.
http://www.counselor.pro/wp-content/uploads/2013/07/Lashaway_-v-_Mugshots__Amended_complaint_AS_FILED.pdf
Washington Rights of Publicity
http://apps.leg.wa.gov/rcw/default.aspx?cite=63.60.010
Hi Mary,
If you browse through blog, you will find that we don’t care about news. Rather, we focus on price and volume action (which may or not be based on news). We also don’t predict the direction stocks will go based on news or other events. We merely trade what we see, not what we think. Have a look at Why We Are Not Worried About A Government Shutdown, as it explains why we don’t trade news.
Hope that helps.