USA Today ran a story recently highlighting 10 S&P stocks with the biggest percentage gains since the last market high. This kind of story is backward looking. Hey, you would be ahead xx% if you bought these names a year ago. Thanks. Let's look at the charts and indicators of these top-10 picks and see what the future might bring. (Click here for Part 1 of this series on Nvidia.)
Over the past 12 months, Amazon (AMZN) has been a top performer, rising while many other names felt the tug of gravity, disappointing earnings, downgrades and selling. Amazon's superior performance was noted in USA Today's recent story on the S&P stocks with the biggest gains since the market's last top. Let's look ahead. (Amazon is part of TheStreet's Growth Seeker portfolio.)
In this daily chart of AMZN, we can see that prices gapped to the upside a few weeks ago before they made their recent new highs. The On-Balance-Volume (OBV) line is confirming the strength and there are no bearish divergences from the momentum study. Prices have been trading around the big round number of $700, which marked the November/December highs.
In this weekly chart of AMZN, above, we can see prices above their rising 40-week moving average line, maybe too far above. Prices could be extended as they have more than doubled in the past 18 months. The OBV line has moved up with prices but it has not (yet) broken out to a new high as prices have. In the lower panel is the 12-week momentum study and it is showing a picture of fading momentum. Top picking in AMZN has not been successful. Prices could dip $50 or $60 and would not hurt the overall picture; however, we wonder how much more room is left on the upside. Stay long and consider a stop loss at $655.