Amazon.com, Inc. (NASDAQ:AMZN) is expected to report its fourth quarter and full year earnings on January 29. This might be the right time to either buy the stock or sell it depending on the company’s earnings report. But what do experts say? Buy it or not? Fast money trader Guy Adami feels that this is the right time to buy the stock and he talked on CNBC about what’s behind the Amazon.com, Inc. (NASDAQ:AMZN) trade.
Adami pointed out that Amazon.com, Inc. (NASDAQ:AMZN) isn’t making money, be he feels that it doesn’t stop anyone from trading the stock. He mentioned that on October 23, when Amazon.com, Inc. (NASDAQ:AMZN) reported their third quarter earnings, which was very disappointing the stock plunged heavily from $320 to $280. He said that $280 proved to be critical support for the stock like it was in May. He added that Amazon.com, Inc. (NASDAQ:AMZN) stock bounced back to $340 post this drop on October 23. Adami’s trade expects some similar scenario into account with $280 on the downside and $340 on the upside.
“[…] Just because Amazon doesn’t make money, doesn’t mean that you can’t trade in the stock. So how do you trade it? Lets go back in time a bit. Back on October 23rd, they reported what can only be […] a disappointing quarter and the stock reacted in kind, trading from $320 down to $280. But, like in May $280 proved to be critical support and the stock bounced all the way back to $340. So how do you trade it now? I think […] you will be able to pull the levers necessary to make the stock go higher. But I also think the stock will fail at $340 level. So get along Amazon right here as the chart suggest. Sell it at $340 and look for subsequent pull back down to $280. I think you will be able to round turn this thing,” Adami said.
Adami said that it is the right time to buy the stock as the trend suggest and look to sell it at $340 as the stock would start falling then. He also cautioned to look out for the pull back to $280.
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