Technical Analysis – Amazon stock declines as 200-day SMA caps upside

Amazon’s stock has been in a recovery mode after finding its feet at the 26-month low of 99.70. However, the price has exhibited a downside correction since it failed to cross above its 200-day simple moving average (SMA).

The momentum indicators are promoting the recent retracement as positive momentum seems to be waning. Specifically, the stochastic oscillator is pointing down inside the oversold territory, while the MACD histogram has crossed beneath its red signal line in the positive region.

Should selling pressures persist, the recent resistance region of 125.00 could act as the first line of defence. Sliding beneath that floor, the share could descend towards 116.00 or lower to test the July support of 106.00. A violation of the latter may set the stage for the 26-month low of 99.70.

On the flipside, bullish moves could propel the price towards the recent reversal point of 146.00. Conquering this barricade, buyers might aim for 158.00 before the spotlight turns to the March high of 170.00 Even higher, further price advances could cease at the 188.00 hurdle.

In brief, Amazon’s latest bounce seems to be running out of juice, but its short-term picture has not turned bearish yet.  Hence, a profound close above the 200-day SMA could signal the resumption of the recovery.

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