AMZN: H&S Top/Descending Triangle

From yesterday morning:

"As we can see, the retest of the Right Shoulder low (horizontal red line) came mighty close to failing! It's a very good idea to have our sell orders filled out and hands on the buzzer on a retest like this because if support gets busted, the stock can go down in fast market conditions."

The 178.16...178.19...178.20 triple support (horizontal red line) got broken (white arrow) in the early going yesterday morning and AMZN went down in fast market conditions.

The pattern is a H&S Top with an extreme left translation for the "Head" of the pattern, or it can be seen as a Descending Triangle, if you will. In either case, the height of the pattern is about two and a half points, which suggested a target price in the 175's.



After a breakdown like that, of triple support, that "should" act as resistance on a retest. That's a shorting opportunity on any rally, but a move above the 178.16 ... 178.19 ... 178.20 is "Ye Olde Knuckle-biter," for the shorts because it suggests a possible false breakdown.

I shorted AMZN at 178.17, at that triple resistance (red arrow), playing it for move a down into the 175's, but I wasn't interested in sitting for "Ye Olde Knuckle-biter" if the stock went much higher than that resistance level. Unfortunately, AMZN rallied into the 178.40's, which I didn't like, so I threw it in just below 178 when the stock came back to the EMA's.

AMZN rallied again, almost to 179, but then fell to 175.75, in the target area for the broken H&S Top/Descending Triangle. I "coulda" had a nice winner, but there you have it. I wasn't up for "Ye Olde Knuckle-biter." Resistance should BE resistance, dang it! LOL.



The action is AMZN since the upside breakout of the Falling Wedge in the daily chart is turning out to be a good illustation of how they can be "iffy" due to the immediate resistance inside the wedge. Technically, AMZN still is broken out, trading above the upper trendline of the wedge, but players who bought the technical breakout of the Falling Wedge are under water on the trade, and the stock also has taken out the January 9 low of 177.00, which was a successful retest of the upper trendline. AMZN is "walking down" that upper trendline, leaving The Bulls wondering if they've got a legitimate break, or not.

The AMZN Bulls need to get up there and knock out resistance in the 184's (horizontal yellow line).




Gain on AMZN short: $300