Amazon’s market cap reached $1 trillion yesterday. As a result, its weekly and monthly RSI are extremely overbought.

Here’s Amazon’s 14 weekly RSI

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Here’s Amazon’s 14 monthly RSI

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Is this a bearish sign for Amazon? Let’s see. Here’s what Amazon did next (historically) when its weekly RSI exceeded 85 (like today).

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Here are the historical cases when Amazon’s 14 monthly RSI exceeded 90.

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Conclusion

As you can see, Amazon’s stock is insanely overbought. When this happens, Amazon’s stock either:

1. Made a short term correction (i.e. 1998 case), or…
2. Made a flat top for 1 year before falling into a bear market (i.e. 1999 and 2007 cases).

Going long Amazon right now is not a good idea if you’re a medium or long term trader.