Amazon (NASDAQ:) has been in a rally mode since last Wednesday, breaking above the downside resistance line drawn from the high of Feb. 2. At the same time the stock is trading above a newly formed upside line taken from the low of Mar. 5. All these technical signs paint a positive short-term picture, in our view.
At the time of writing, the price is testing the 3235 barrier, which is marked as a resistance by the inside swing low of Feb. 12. If investors are willing to push the action past that zone, we may see them aiming for the high of Feb. 18, at 3337. However, given the latest rally, we could see a small setback before the next leg north, perhaps for the share to test the 3164 support barrier.
Shifting attention to our short-term oscillators, we see that RSI runs above its 70 line, but has started to show signs of topping, while the MACD lies above both its zero and trigger lines. Both indicators detect strong upside speed, but the fact that the RSI has started to top, adds more credence to our view that a pullback may be in the works.
However, in order to abandon the bullish case, we would like to see Amazon falling below the 3012 support zone, marked near the low of Mar. 19, and slightly above the low of Mar. 26. This will take the price below both the aforementioned diagonal lines, and may initially pave the way towards the low of Mar. 8, at 2950. Another dip, below 2950 may carry more bearish implications, perhaps setting stage for the low of Mar. 5, at 2880.
Disclaimer: The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval. 79.07% of the retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure – https://www.jfdbrokers.com/en/legal/risk-disclosure .Leave a comment