This is a much wider range than I normally employ but I want to give this a wide berth since this is a volatile stock.
I'll most likely go long at $52 but it's a long ways away so I'll see what the market is like when (if) we get there.***** Off topic
This market is giddy - just imagine if we lose 1 million jobs Friday - it might go up 20%. I keep teasing about this lousy Baltic Dry Index because this is the latest "thesis" trade. If you are not familiar with what this is, its a shipping rate - when it goes up everyone says global growth is emerging; when it falls everyone says global growth is diminishing. As if 1 shipping rate rules the world GDP. In 2005-2006 the Baltic Dry Index was between 3000-5000 for the majority of the time. That's a normal economy; than it went irrational in latter 2007 through mid 2008 ... going north of 11,000. It fell to 700s late last year (down 90%+!) and now is "back up" to 1100. And I'm supposed to be giddy about global growth? It could double from here and still be 50% below 2005-2006 (i.e. normal) levels.
But never let a thesis stop you. It's all about thesis when you need to "create" something out of nothing. I would like to reiterate I've been saying the U.S. will not lead the world out of this recession as is the popular convention. I think it will be Asia. But not yet. This reminds me of the "housing is bottoming" call in spring 2008 and "technology is safe" call in summer 2008 and "can't get worse in financials" every 3 months for the past year and a half. Thesis. All those worked for 2-6 weeks and them those who followed said thesis had their hat handed to them. But for daytraders and momo guys it can work for a while. Until reality sets in. I don't see anything different here.
Short Amazon.com in fund and personal account
7 comments:
great 2 paragraphs under the off topic header. i enjoy your site.
p
Thanks
The BDI is a play on 'hope' that China is moving again. That explains the recent increase in teh FXI. In essence it's a dance between the FXI and Baltic Dry Index. I haven't read your article on the Chinese trouble..(but I can guess what you've got to say).. This has all the appearances of a bear rally. jegan
I'm currently shorting AMZN at 6463 but I going to be honest I think for this stock to fall it's going to take some kind of "Black Swan" event.
Perhaps the new warehouse in Swansea is built on a mineshaft, or the Kindles are going to spontaneously catch fire.
Actually just writing this and examining it's balance sheet makes me think I should just forget this stock - it has an enormous cash reserve and practically no debt. It's bulletproof and I just can't see a reason for it to fall apart from the ludicrous P/E
Sinclair, I wish you luck - this is a monster. If it gets north of $66 I'd take cover. Aside from a ridiculous PE ratio it has everything going its way.
Didnt some Sony laptops do what you hope happens to Kindle? lol
That's an outlier event ;) I prefer higher probability outcomes.
I think got lucky today bought at 6084 for a pretty nice profit due to an unexpected 6% drop (auto profit limit - its the best way to go). As you say though I had set my stop at just above 6600. No, tell a lie, I had actually got up this morning and set my stop loss at 65 because last night I convinced myself that the stock was so good!
I probably won't try this again though.
Cheers Mark
Good job, funny how we were just talking about it the previous day. A weird day Friday where all the generals took bullets out of the blue.
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