WMT, AMZN, and Trading Bounces

The Entry Points

We’ve been bullish (trading-wise) on retailers over the last few months, believing the selloffs are opportunities for at least some good bounces. Why have we liked them? Because they have gotten creamed, and many of them are or were back into big support areas, sometimes multi-year areas – and also the selling climaxes – BONT or URBN, TGT. Look at what LL, BBY, or LULU have done after their big selloffs. Even crappy JCP, HIBB, SSI can bounce, or LB with a recent selling climax. Many people are extrapolating the death of almost all retailers by assuming how AMZN will destroy all their competition. Really? For those old enough, remember 20 years ago how the WMT “monopoly” would be taking over the world. “Economists” and “stock market experts” were claiming that brilliant idea right smack into the huge high in late 1999, when they were allegedly a “monopoly”. Whatever happened to that stupid idea? Look at this WMT chart.  Since that high, the price of WMT is up about 15%, in 18 years. A monopoly, eh? So now our President is not a fan of AMZN, tweeting “Is Fake News Washington Post being used as a lobbyist weapon against Congress to keep Politicians from looking into Amazon no-tax monopoly?” So back to WMT, in the early 2000’s they became concerned and started changing their business practices to avoid having to deal with “monopoly regulating”. AMZN, now it’s your turn.