Technical Analysis – Amazon stock cautiously bullish despite pullback


Anthony Charalambous, XM Investment Research Desk

Amazon stock aggressively gapped up near to 2,050 on 31 January and proceeded to plot a fresh all-time-high of 2,066.36 before correcting slightly below 2,034. Buyers’ efforts are currently steering the stock back up, a move aided by the upward sloping simple moving averages (SMAs) and the recent bullish crossover of the 200-day SMA by the 50-day one.

Moreover, the technical indicators suggest positive momentum may keep up with the latest move, even though the RSI and Stochastics are located in overbought territories and the MACD, in the positive zone, continues to rise above its red trigger line.

To the upside, immediate resistance could come from 2,050 – the previous all-time high from 04 September 2018 – and the new all-time peak of 2,066.36. Conquering the top, the price may rally to test the 2,118 obstacle, which is the 123.6% Fibonacci extension of the down leg from 2,034 to 1,680. If the climb extends, the 138.2% Fibo extension of 2,169 may catch traders’ eyes.

Alternatively, if sellers manage to push below the 2,034 mark, the 2,000 psychological number could stall declines, in attempt to fill the gap from the beginning of the month. Moving lower, the 1,950 hurdle could deter the bears testing the support region of 1,915 to 1,902 – which encapsulates the 20-day SMA – and 1,874 level underneath.

Overall, a bullish bias in the short- and medium-term may continue if the stock manages to remain above 1,915 and more importantly above the 200-day SMA area of 1,838 and 1,820 trough.