Amazon is tracking for its worst quarter since 2008 and now faces a key technical test

Amazon has not seen these kinds of losses in a decade.

The stock, one-fourth of the FANG trade, has tanked 23 percent since the beginning of October, tracking for its worst quarter since the fourth quarter of 2008.

There could be more downside ahead for the stock, said Ari Wald, head of technical analysis at Oppenheimer.

"The stock needs additional time to stabilize but we think it is fine for the long term and probably one of the better-looking retail charts with the rest of that group really breaking down," Wald said Monday on CNBC's "Trading Nation."

The XRT retail ETF, which holds Amazon, has tumbled 8 percent so far this year. Meanwhile, Amazon remains 33 percent higher since January.

"What's important to note here is that while the S&P 500 is breaking below its October low, Amazon is still above it, trying to make this higher low. That is a sign of relative strength that we like to see," added Wald.

"For levels, $1,450 is one we're watching. There's a key retracement there," said Wald. "We still think this stock works for the long term. Bullish long term, near term let it stabilize for longer."

Amazon last broke below $1,450 on Nov. 20. It is a 6.6 percent decline from reaching it again.

The fundamentals case supports longer-term gains even if the stock's performance suggest more pain could come, said Boris Schlossberg, managing director of FX strategy at BK Asset Management.

"We have to separate Amazon the company from Amazon the stock," Schlossberg said Monday on "Trading Nation." "The stock went on a parabolic run and now it's correcting properly."

At its peak in September, Amazon shares had rallied 75 percent for the year. Since then, it has tumbled 24 percent and entered a bear market.

As a company, Amazon should continue to deliver, said Schlossberg.

"Amazon is just simply an unbelievable juggernaut of execution and I love it for the long term, but for the short term the stock is going to wallow so you probably just want to simply collect it by selling puts," he said.

Selling a put is typically a bullish bet where the seller has an obligation to buy the stock at a predetermined price.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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