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Technician: Amazon a 'red flag,' Nike 'too early to buy'

MKM Partners' Jonathan Krinsky made an unpopular call to sell Nike back nearly a month ago, but it actually turned out to be a smart move.

Nike stock dropped close to 8 percent since Krinsky made his unconventional call. So where does Krinsky think investors should go from here?

"I think the risk here is that when something got so extended to the upside that when it finally does correct and pull back, it overshoots to the other side," Krinsky said. "Maybe back even towards the 200-day moving average, which is another 10 percent or so lower."

Krinsky also added that Nike is one of the "lone holdouts" in the retail bear market. However, he said Nike is not immune to the risk of sell-off like the rest of retail and it might be too early to call a "buy" rating on the stock.

Within the retail sector, Krinsky said he'd sell Amazon right now, despite the stock's hitting its all-time high last Wednesday.

"You see 82 percent of analysts have a 'buy' rating on the stock versus 55 percent a year ago so you're seeing sentiment get very frothy after the extended move. And then what happens to Amazon? It has one of the biggest down days on high volume that we've seen in quite some time ... a red flag should be going on at that type of price action," Krinsky argued.

Time will tell if Krinsky's latest call will pay off once again.