Good to see ya here William. After reading a hundred posts or so, I think you are being unfairly maligned. I don't think you are arrogant or any of the other things people are saying about you. I think you just feel confident about your position and won't back down when articulating your beliefs.
Having said that, I took a pretty good size short position in AMZN on Friday, for several reasons. I have been inclined to short AMZN for a while now but could either never get shares or had to jump out real quick because the momentum was too great. No sense in stepping in front of a freight train.
The reason I am revisiting an AMZN short is because of a number of factors.
#1 I could easily get shares. That in itself tells me that the squeeze has abated somewhat. Shares are always difficult to come by at the height of a squeeze.
#2 Some fairly substantial shorts have been totally wiped out by AMZN. Many have just given up on it. I like to step in at the maximum point of pain.
#3 I think the BKS.com IPO is a negative for Amazon. It will provide a cash infusion which will be helpful in attacking AMZN. It will attract major publicity to BKS.com which I see as a negative for AMZN. It will provide another avenue for investors to bet on the net. This could divert money away from AMZN stock in favor of BKS.com. (Essentially Cramer's valid theory of increasing supply). Other hot IPO's like GCTY, INKT, etc also help increase supply
#4 All the standard arguments of competition and excessive valuation
#5 AMZN has made what appears to be a double top and has had some decreasing highs lately. Of course you could attribute this to the weak market, and I don't rely heavily on TA, so I don't place a huge amount of weight to this argument.
#6 Net stocks in general haven't been responding to good news like they used to. There is widespread talk about using accounting tricks to bolster the bottom line. What happens to internet stocks if the SEC or FASB decides to tighten up on some accounting standards? AOL is dealing with this right now if I'm not mistaken, and there could be a precedent setting decision at anytime.
#7 While I am aware that the market held some support levels on Friday and survived a test of the 200 DMA, it appears very weak and susceptible to a large decline. (Although I'm not betting on it)
#8 I see a resurgence in what Cramer refers to as "old-tech". INTC, CPQ, SEG, COM$, etc are acting quite well. I think these "cheaply valued" stocks are attracting money. I think some of that money was chasing internet stocks over the last 6-9 months, and will leave.
#9 Last but not least, Michael Dell registered to sell some shares a few months ago. He is one of the smartest businessman on the planet and he probably thinks it's time to get out! $-)
I wanted to post my position on AMZN before the Asian markets open up Sunday night so if they tank and Monday is a disaster people won't say that I said I was short only after seeing Asia. I think AMZN is a good short even if the world markets don't collapse this weekend.
I'm already down 3 points on my short to be honest, but perhaps I can take some consolation that maybe AMZN dropped in after hours on Friday? I don't place too much emphasis on these quotes but nonetheless, they show the last trade of 800 shares at 125, almost 5 points below the close. Most of the other trades are slightly above the closing price so perhaps it is an aberration
fast.quote.com
P.S. I notice some other well known tech stocks dropped in late after-hours trading as well. |
