Kroger is on the Verge of Being Another One of Bezos' Pendejos

The Kroger Company, founded in Cincinnati, Ohio, by Bernard Kroger in 1883, is seeing shares of its stock plunge today in front of earnings tomorrow morning. Simply put, unless Kroger can shock and awe The Street to the upside, it is looking more and more like KR is a bonafide creative destruction victim at the hands of Amazon/Whole Foods/Jeff Bezos synergies. 

Kroger is a name we have been cautious on for a good while, admittedly too early at one point. 

However, on the updated monthly chart, below, even an earnings gap up tomorrow in the 5-15% range will not likely reverse the bearish technicals in play.

The supermarket chain has a confirmed bearish head and shoulders top, outlined, and recently looks to have made a lower high by price (arrows), projecting a move down into the teens. I am not suggesting to short KR into the report, though.

Instead, a better play would be to fade a post-earnings bounce, if it gets one and play for prospective downside perhaps looking out into the May/June interval via puts. Either way, Kroger is in bad shape technically and looks to be getting the short end of the stick of Amazon's bold entry into the grocery business. 

We have spent a fair amount of time focusing on positive retail plays brushing off the Amazon Effect. But, clearly, Kroger does not fall into that category.