Jeff Bezos sat down with Charlie Rose on 60 minutes just hours before Cyber Monday kicked off. Going into this interview, Amazon.com, Inc. (NASDAQ:AMZN) rallied for six days straight to new all time highs, just under the $400.00 level.
Bezos talked about using drones to deliver packages from Amazon in near future. This has generated major buzz in the media and a lot of discussion on whether or not it is feasible. The stock opened higher and kissed $399.00 before reversing. The reversal is technically a bearish signal.
This wild news reminds pro investors of the hype that usually ends a strong run for the stock. In addition, the even number of $400 must be respected as resistance. The reality of drones is somewhat silly in the near term. First, FedEx and UPS will throw massive lobbying dollars to the government to try and block it. Afterall, this would hurt their business. In addition, I know many Americans that will shoot a drone out of the sky if they see it. #TargetPractice. Lastly, drones dropping packages on people #LawsuitsGalore, packages getting stolen, bad winds, weather ect. There are a ton of question marks and liabilities that Amazon will have to deal with to get this through, at least with the current technology. I tip my cap to Bezos as he is trying to be Elon Musk-like but drones are years away.
I am eyeing Amazon as a short up here for a solid pull back into 2014. The valuation is stretched even if the most expensive model.