Amazon Win Streak Draws Fresh Batch of Bulls

WMT is reportedly considering a streaming service

Jul 17, 2018 at 2:15 PM
facebook twitter linkedin


The shares of Amazon.com, Inc. (NASDAQ:AMZN) are pacing for a ninth straight gain -- matching a late-May win streak -- up 1.3% to trade at $1,848.22, and fresh off an all-time high of $1,851.69. In fact, not even an Amazon Prime Day site crash and reports Walmart (WMT) is considering a streaming service can stop the FAANG stock, which is headed for its fifth straight record close.

amzn stock daily price chart on july 17

Options traders are active in today's trading, too, with roughly 171,000 AMZN options on the tape so far -- 1.4 times what's typically seen at this point. Most active is the weekly July 1,850 call, where more than 10,000 contracts have traded.

It looks like new positions are being purchased here for a volume-weighted average price of $9.94. If this is the case, breakeven for the call buyers at this Friday's close -- when the front-month options expire -- is $1,859.94 (strike plus premium paid).

This optimism just echoes the broader sentiment seen toward Amazon. For starters, options buyers at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) have initiated 1.13 calls for every put over the last 20 sessions.

Analysts have been quick to issue bull notes ahead of the e-commerce titan's upcoming earnings report, scheduled for release the evening of Thursday, July 26, while the vast majority of those in coverage currently maintain a "buy" rating.

Elsewhere, short sellers have been throwing in the towel amid the stock's longer-term uptrend, which may have helped boost AMZN to a 58% year-to-date lead. Short interest on Amazon plunged 15.4% in the most recent reporting period to 4.28 million shares -- just 1% of the available float.

Trader: Sell These 8 Stocks in 2021

1633101108

 




 
Special Offers from Schaeffer's Trading Partners