Shares of Amazon.com (NASDAQ:AMZN) continue to grind higher. However, unlike stocks like Facebook (NASDAQ:FB) and others, it has not made a new all-time high in recent days. In fact, Amazon has a classic bear flag wedge pattern formation on the daily stock chart. This signals a likely sharp drop in the coming month, possibly on an earnings miss. With the chart setup being strongly bearish, there is a classic way to swing trade the stock.
Short Here
Look to short at current levels of $1,730, with a stop on any daily close above the all-time high of $1,763.10. This allows for a tight, less-than 2% stop. The downside reward is fantastic, with the calculated target from the bear flag being $1,520. This is a 12% profit. A risk/reward trade setup like this is what the big players look for when swinging the market. Enjoy!
