Bearish Outlook For Amazon.com, Inc. (AMZN) Based On Year To Date Performance

Amazon.com, Inc. (NASDAQ:AMZN)’s stock prices have been fluctuating a lot recently which has investors worried. The stock has been seeing a series of lower highs and higher lows during the year to date. Stock market strategist, Carter Worth, explained why he was bearish on Amazon in CNBC’s Options Action.

Worth compared the performance of the online retailer against other retailers over the past two months. It was quite clear from the charts that Amazon.com, Inc. (NASDAQ:AMZN) was facing a low. While peers such as American Eagle Outfitters (NYSE:AEO), Kohl’s Corporation (NYSE:KSS) and Family Dollar Stores, Inc. (NYSE:FDO) grew by 38.5%, 19.5% and 28% respectively, Amazon was down by 0.6%. Lands’ End, Inc. (NASDAQ:LE), Ross Stores, Inc. (NASDAQ:ROST) and Foot Locker, Inc. (NYSE:FL) also outdid the online retail giant in the two month performance chart, posting a growth of 23.1%, 17.9% and 15.8%. “[Amazon] is not keeping up with retailers in general,” he said. And with that simple sentence, he summed up the trouble faced by Amazon.

Worth then brought up the chart dating back to 2009 when the bull market began. Amazon.com, Inc. (NASDAQ:AMZN) had been consistently outperforming all other retailers which in turn performed better than the S&P 500. But when the same chart was considered for the year to date figures, the trend was reversed, with other retailers doing better than the S&P 500 and Amazon faring the worst of the three.

Following this, he brought up the chart showing Amazon.com, Inc. (NASDAQ:AMZN)’s stock price over the last five years. While the chart showed an increasing trend, towards the end, a wedged triangle pattern was observed. He explained that this pattern corresponded to a threshold where either the bulls win or the bears win and predicted a dramatic fall would follow. “We would not be long Amazon and if you are looking for a short sale, we think it is a good one,” he declared.

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