AMZN, GOOGL updates 09/06

AMZN: the online retailer is likely not going to shine for a while, as Primary III topped. Not too surprising as AMZN soon has bought anything it can buy and then there’s simple no good news left; only more problems as with every expansion comes more trouble. Anyway, back to the numbers and charts. The first chart shows the monthly with clearly defined primary, major, intermediate and even minor waves. All TIs are now pointing down, there’s negative divergence and July had an ugly buyers exhaustion candle (long upper wig). 4th waves retrace typically between 23.6 to 38.2% of the prior entire 3rd wave. This should bring price back to $830-$673. We’ll take a look at the daily chart to get a more detailed look.

amzn monthly

On the daily chart we can see how price has so far been held up above the S/R zone at $950-$925, bounced twice to the 50d SMA, but got rejected both times. The SMAs are starting to loose their bullish set up, with the (dotted) 20d now below the blue 50d SMA, which is also pointing down and about to cross the red 100d SMA. The technical indicators all spiked on last week’s high only to reverse, pointing now down and are on sell. This suggest last week’s high was a b-wave and the low was an a-wave. Using the standard c=a fib-extension we then get to almost $830, which is the 23.6% retrace as shown in the above monthly chart. A break below the S/R zone is the signal price is on it’s way to the target zone. After that we can then determine if Primary IV completed or if that was only major-a.

AMZN DAILY

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GOOGL: Should now be in (yellow) major-4 of (blue) primary V. Also here -like AMZN- we most likely have a (red) intermediate-b wave high and a a-wave low, with a c=a extension targeting $870. Since major-2 was an irregular flat, the “rule” of alternation suggest major-4 will be a zigzag. The shown pattern meets that criteria. Note this is not a hard rule, but simple mostly the case. Note how the bull flag target was reached perfectly and how the waves adhered to the Fib-extensions. In this case major-3 was almost 2.000x major-1, which is a bit uncommon, and therefore major-4 should target the 100% extension. Using a 5=1 relationship major-5 will then barely go above major-3 to the (blue) 276.4% extension: $10118. A typical extended 5th wave target. This then also meets the V=I relationship.

GOOGL daily

I also wanted to show “the regular” daily chart, where we have the TIs etc. First observation: big negative divergence between the (red) intermediate-iii and (black) major-3 tops on the MACD and OBV: less momentum, less money being put in. Second observation: ideal A.I. sell signal (all 3 TIs dropped <80 on Tuesday). This setup in combination with the spike high and drop strongly suggests last week’s high was a b-wave high. A break below the blue support line ($920-$922) is now needed to confirm intermediate-c. Please note that the 20d SMA is now below the 50d SMA and both are pointing down. This chart also has the c=a relationship, which if correct points to the prior intermediate-i high level: resistance becomes support. This move down will also close the early-may earnings gap. After that price can then rally for major-5.

GOOGL daily2