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NEW YORK (TheStreet) -Amazon's (AMZN) - Get Inc. Report growth and valuation have provided much fodder for debate: Bears argue the valuation is unfathomable, while bulls talk about the bright future and continue to push the stock higher and higher.

Personally, I see both sides. The stock price continues to go higher, even though profits continue to flatline. But, hey, that's the trend. Why short into that? I never understood that. The bearish rationale makes sense, and I can see why someone wouldn't buy the stock. But shorting it -- at least over a long period of time -- seems to be equivalent of stepping in front of a train.

But the stock could be an excellent buy rnow, after it finally broke out of its short-term downward channel. As you can see on the image below, the stock was already favoring the downside going into earnings.

Chart Courtesy of

Although the results weren't flattering, the stock still popped, hitting a 52-week high of $313.62. The stock had already begun to trend lower, and following the earnings jump, it continued to slide, stuttering against the upper resistance line until finding support near $283.

The $283 to $285 level acted as decent resistance back in June, when Amazon was trying to go higher. As if it were taken from a technical analysis textbook, the stock recently found support near its old resistance levels and has started to move higher.

Last Thursday, Amazon ripped higher and was able to break out from the downward channel and moved slightly higher on Friday, as well, ending the week at $290.01. That bodes well for the stock, and if it can garner some upward momentum, bulls should be pleasantly surprised.



(AAPL) - Get Apple Inc. Report

has been making all sorts of headlines as of late. The stock has been the talk of Wall Street for years now, but over the past six months or so, it's been for all the wrong reasons.

After topping out at $705.07 in September 2012, the stock has been nothing but trouble for the bulls. It trended sharply lower heading into 2013 and didn't stop there, finally bottoming near $380 in April. Since then, however, the stock has been doing a lot of repairs on the technical side of things. Allow me to explain, following the chart.

Chart Courtesy of

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The chart was a technical nightmare for bulls and a dream come true for bears. The pink line represents the downward trend the stock followed since topping out in September. However, in the beginning of May, that trend flipped from resistance, to support -- much like the Amazon situation we just talked about.

Moving along, the thick blue lines on the top and bottom represent the longer-term channel for the stock, with a double bottom forming near $380. That is a good sign for bulls.

In between the thick blue lines are two thinner blue lines, representing a shorter-term channel. In mid-August, the stock was finally able to close above the shorter-term resistance. After the Carl Icahn

announcement via Twitter

, the stock ripped through its 200-day moving average -- another bullish sign -- and was also able to push through the top channel of resistance near $500.

While the stock became overbought in the short term, it only seems to be consolidating at this point. The stock will continue higher -- barring a market collapse -- after taking a much needed pause.

Also, on a historical note, the stock rarely sells off or stays flat going into the company's new product announcements. Usually, it's more of a "buy the rumor, sell the news" action, meaning traders and investors buy ahead of the event. The company is expected to unveil its new iPhone -- and perhaps even more - on Sept. 10.

This year, the strategy in equities has been to "buy-the-dip." With some noticeable obstacles in front of us, however, I can see why bulls are hesitant to hit the buy button. Until the trend turns, though, I'm going to stick with what's working.

Amazon is a high-beta stock and the sentiment for Apple has shifted as of late. I'm looking for Amazon to get to $305 and for Apple to reach the $540 level, if the current $500 level can hold as support.

At the time of publication, the author was long Apple and Amazon.

Follow @BretKenwell

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.