Creepy Buys From TheStreet.com

Don't blink because this was one of those crazy days where a huge amount of dumb things were alleged about the stock market. Perhaps the stupidest of all was the impression put forth that Amazon (AMZN) and Google (GOOG) are buys right now. Who wants to go long a downtrending stock. Not a soul, true?

TheStreet.com published an article declaring "Rally Is On" today after market close. The article then goes on to cite Joe Terranova as telling us the downside momentum of the market has been reversed and that it's time to get into names like Amazon (AMZN) and Google (GOOG).

Thus let's put TheStreet.com to an honesty test and examine if the downside momentum of the stock market has reversed and if it in fact is time to purchase Amazon (AMZN) and Google (GOOG).

In this episode I look at the charts of Amazon (AMZN) and Google (GOOG). What I find might alarm you and it perhaps will nauseate you. Both stocks are in a downtrend.

No crucial levels have been taken back by bulls and if you look at the volume to establish the momentum, you will discover that neither these stocks nor the stock market as a whole has reversed downside momentum yet. The On Balance Volume and Accumulation/Distribution technical analysis studies both expose that the small bounce over the last two trading days is little more that a two day bounce within a larger two month downtrend. What did you expect it to show? Two up days does not a market make. In fact, the volume on both charts shows the buy side volume falling off.

Now look, I have no interest in talking down Amazon (AMZN) or Google (GOOG) but the stock chart is what it is. I'll be the first to go long this stock market when the trend reverses. The downtrend has not reversed so far and I find it exceedingly insincere and disingenuous of TheStreet.com to publish articles that would suggest otherwise. This is why you must learn technical analysis. Don't be the fatality of these polished chatting sharks who wish for you to go long in a downtrending stock.