Technical Analysis – Amazon accelerates bullish rally to test all-time highs


Anthony Charalambous, XM Investment Research Desk

Amazon stock has been experiencing a one-month bullish rally from a pullback move at the beginning of May to a low of 1670, and today broke aggressively above the seven-month high of 1964.

With the help of short- and medium-term simple moving averages (SMAs) of 14 -, 21- and 40-day SMAs respectively, bullish crosses are in place confirming the momentum and positive trend which is in progress towards the highs.

The MACD and the RSI are also supporting the bullish bias of the share price as the former rebounded on the trigger line to move further north into the positive area, whilst the RSI flirts with the 70 level, aided by uptrend line. The ADX, after falling to a level of 18 showed a weakening uptrend strength, but has come on board with the rally jump, as it is currently standing at 21 and pointing upwards, indicating an accelerating strength in the trend. 

On the one side, momentum indicators and the behavioral bullish bias of the share, suggest that the next target to come in play is the 2032 resistance high before the all-time high of 2050 can show us its worth.

However, if the ADX were to fail to break above 25, and fell below the 20 level and the MACD and the RSI turned lower, a possible gradual move down to 1964 and the 14-SMA could unfold, before 1870 and the 23.6% Fibonacci retracement level of the move from the ten-month low of 1305 to 1964, at 1808 are tested.

Overall, Amazon stock price seems to be strongly positive in the long-term.