During market pullbacks, I like to add to my long-term stock accounts. One of the tickers I’ve been adding more of lately is Amazon (AMZN).
Why Amazon?
The long-term goal of the stock portfolio is to accumulate enough shares to create an income stream via selling covered calls and creating wealth from the shares themselves. Since Amazon split, it has been an even better candidate for accumulating shares for these purposes.
I also love shopping there and have followed the stock for a long time. It has many of the key metrics I look for, including strong fundamentals, technicals, and leadership in the space. It also has high liquidity and trades in the options market.
But of course, it’s all about timing. So, why buy more shares now? That comes back to the technical setup, which is how I define my entries. One of my favorite entry points on a weekly chart is the weekly squeeze! Check out a screenshot below:
Amazon Weekly Chart
The last two weekly squeezes, combined with VZO buy signals, led to multi-month moves higher in this stock. At this point, Amazon has pulled back very nicely into the 50 SMA, the volume is shifting, and the squeeze is getting set up to slingshot higher.
I have upside targets first at the retest of previous highs ($201) and then between $215 and $229. This also coincides nicely with the earnings report in October, as Amazon can typically rally going into earnings as well.
