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  • vornash Jul 20, 2013 12:40 PM Flag

    Why I'm Short

    My thinking is as follows, it's at the top of a trend line in a well defined up-channel structure, and at the top of a bollinger band (indicating overbought). We have peers missing earnings like MSFT, GOOG, and EBAY. Retail is down and increasing oil prices may increase Amazon's cost of shipping as a percentage of revenue (as FedEx warned). The upside risk seems low for the short term at least. Plus, most analysts are bullish and have been.

    But I have no illusions about a stock in an uptrend like that though. If it doesn't go my way in the next week, I'll either take profits or let my stop get hit at 306. Amazon is a great company for customers, but not so much for stock holders. A revenue miss could send this stock tumbling down significantly 5-10%, which is what I'm shooting for. Additional downside is less certain. I'm not going to sit on this thing stubbornly as it rockets higher and higher. But don't be surprised if we see 275 soon. Long term this channel will be broken one way or another, and the last time it broke a channel like this it was to the downside to correct.

    Sentiment: Strong Sell

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    • Shorts, your are the backbone of America.

      We appreciate your hard work.

    • Today's action shows why you shouldn't have such a tight stop loss on an AMZN short. I hope you took my advice yesterday and removed it.

    • What if you had a crystal ball and you knew that amzn would miss both top and bottom line? Would you short it big time? Well when amzn report q4 2012 results they missed both top and bottom line. The stock rallied. I agree with the shorts here. Amzn is a long term dog. But there is no gaurantee that investors will suddenly realize the intrinsic value of amzn.

      • 1 Reply to tail_risk
      • Bezos haz had 9 quarterly missez in a row with # 10 on tap.... It doesnt matter trading fundies and carts for that matter have mudered retail shorts. The winnerz : execs comped with free stok, underwriterz of eventual bad debt whose feez incl free stock, politicianz on the take for the lobby, and algo bots that write crack head optionz by the week. The lozerz: retailer traderz that trade with a sane thesis, brick and morterz that have been put outta business, the US economy where small business ownerz are displace with shieotty warehouse jobz, goodz and servicez providerz witwith multiple outlets being dimuned to a monopoly, and the US public that has to make up for gvt revenue short commingz az theze clownz skip on their 'fair share' of taxez.


        Wealtg iz neither created nor destroyed, its merely transfered from the many to the few....

    • You underestimate the downside. More like 15-25% on a miss. $205 worst case?

    • Take a stand dude, If you think it is on an uptred buy do not short. This stock is going down though as you will see so take a position and do not weep like a woman...

    • I agree with your thinking but agree that you don't want to cover at 306 before earnings. Heck, that's only 75 cents above current price. I plan to hold my short at least through earnings. After that it just depends on how the overall market is trending. If you believe Sybil, we hit 350 next week. LOL

      • 1 Reply to stkguy
      • vornash Jul 20, 2013 3:00 PM Flag

        You are braver than me then. I don't trust this thing any further than I can throw it, which isn't far. There's a reason why short interest is less than 2% in this stock, shorts have been battered and mutilated, which presents opportunity but also risk. If we break above 306 I may execute a short from a higher position pre-earnings.

    • With an average daily range of 5 to even 10 per day, a stop that close will not give breathing room for a one week trade? The market maker will get the stops close to market price as they have a computer program that figures out if they will make a profit by tripping the groups of stop orders at various levels. Once a stop is triggered it, becomes a market order that is subject to the honesty of the market maker. I once had a stop filled slightly but obviously off of the market price, which was only somewhat annoying to me, but if they do that regularly they make serious money, so after that I try to never use a market or stop order on nasdaq. Although, I expect the large volume stocks are a little less susceptible.

    • Ok, suppose it drops below 300 next week. Where do you cover? Or will you just feel it out? Is 275 a place you'd feel good covering?

518.01-0.36(-0.07%)Aug 28 4:00 PMEDT