Amazon and UPS’ Bad News is Pushing This Stock into a Dangerous Double-Top

FedEx (FDX – NYSE)

Friday, July 26, 2013

On Tuesday, we heard that UPS (UPS – NYSE)’s second-quarter profit fell 4% as customers shifted to slower, cheaper services.

Today, we learned that Amazon (AMZN – NASDAQ) lost some $7 million ($0.02/share) last quarter.

And when we look to the larger market, we see a dangerous double-top building up.

No real shocks here. High-end retail may be holding up, but the rest of the world is still willing to wait a while on purchases.

We’ll have an interesting way to trade that top this week in Bottarelli Research LEAPS. Trust us, it’s not what you think. In fact, it’s about a stock that runs opposite to the Dow. But it’s not gold or one of those whacky “inverse funds."

For today, we just want to warn you of a more direct result of this chain of facts.

FDX 072613

Bottarelli Research Tip: UPS’s top rival, FedEx (FDX – NYSE), has already warned of headwinds over the next quarter. And when we look to its chart, we see that same double-top that the broad indexes are showing. Even a conservative estimate has FDX dropping back to the 200-day (40-week) moving average at $97.50, while our own methods indicate a follow-on move to the 38.2% retracement marker at $91.86.

Is Starbucks Eying GMCR? This morning, Starbucks CEO Howard Schulz was on CNBC talking about his company’s great earnings results – and he was asked the question, “When is Starbucks going to buy Green Mountain?” For a fraction of a second, he gave a look that (to us) said, “Hmmm, that’s not a bad idea.” But then, he responded by saying they have a great working relationship with Green Mountain and look forward to working with the company more in the future. Either way, this could be an explosive trigger for GMCR going forward, and you better believe we’ll be trading it in Bottarelli Research. Are you ready to join us for a 50% new-member discount?

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