AMZN bum to the penny and now it's time to reverse?
AMZN had a nice and strong drop just as it was analyzed in the last report and in our Hot stock pick report. AMZN is still in a huge falling wedge which is a bullish pattern when and if breaking the upper trend line, however last time it touches that trend line it was rejected with a "hammer". Price had a healthy correction to 0.5 FIB, and at the same time, it formed a bullish reversal candle Hammer just as it touches 20 days MA, 0.5 FIB, and the horizontal line. Can it be better than that, it's really a textbook move. Also, it could now be a nice bull pullback targeting again BigRed and the upper trendline.
Volume is neutral, bullish, and bearish due to the strong volume days on both sides.
Price is above 20 and 50 days MA but below 200 days MA / BigRed which is mixed.
RSI did cool down and is in neutral territory.
MACD, however, has smaller and smaller ticks and it seems like are trying to converge or cross over each other which if done would be bearish. But if the MACD line, the blue line, manages to stay above the signal line that would be bullish.
Overall: AMZN did correct/ cool down after an extreme move to the up and after it got rejected from 200 days MA and trend line. Now is ready to move up, but there will be a question does it have the power to move above that 2 major resistance, or will fall again? The issue is it is almost certain, when and if it reaches those resistance levels (blue circle) it will form bearish divergences on both MACD and RSI which will represent strong pressure on price. However, if it finds support in buyers and it breaks above the trend line, it would trigger a massive buy wave from all over due to the breaking out of a bullish pattern. Time will tell. Take small steps. Trading is a marathon, not a sprint!
Volume is neutral, bullish, and bearish due to the strong volume days on both sides.
Price is above 20 and 50 days MA but below 200 days MA / BigRed which is mixed.
RSI did cool down and is in neutral territory.
MACD, however, has smaller and smaller ticks and it seems like are trying to converge or cross over each other which if done would be bearish. But if the MACD line, the blue line, manages to stay above the signal line that would be bullish.
Overall: AMZN did correct/ cool down after an extreme move to the up and after it got rejected from 200 days MA and trend line. Now is ready to move up, but there will be a question does it have the power to move above that 2 major resistance, or will fall again? The issue is it is almost certain, when and if it reaches those resistance levels (blue circle) it will form bearish divergences on both MACD and RSI which will represent strong pressure on price. However, if it finds support in buyers and it breaks above the trend line, it would trigger a massive buy wave from all over due to the breaking out of a bullish pattern. Time will tell. Take small steps. Trading is a marathon, not a sprint!
Consistency is the key of success....
