Amazon.com tried to rally a week ago. It proceeded to fall on weak quarterly results, leaving some potentially difficult patterns on the daily chart.
First, the single candlestick on February 2 was isolated above the other recent prices. That is sometimes known as a bearish “abandoned baby” -- essentially a failed breakout.
The location of the candlestick is potentially important. By occurring at the falling 200-day simple moving average (SMA), it suggests the longer-term downtrend remains in effect. (It was AMZN’s first test of the 200-day SMA since August.)
It was also near a bearish gap on October 28, which was triggered by weak guidance.
Next, the Relative Strength Index (RSI) is retreating from an overbought condition.
Traders looking for continuation lower may now watch for a potential break of the trendline along the lows of 2023.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
First, the single candlestick on February 2 was isolated above the other recent prices. That is sometimes known as a bearish “abandoned baby” -- essentially a failed breakout.
The location of the candlestick is potentially important. By occurring at the falling 200-day simple moving average (SMA), it suggests the longer-term downtrend remains in effect. (It was AMZN’s first test of the 200-day SMA since August.)
It was also near a bearish gap on October 28, which was triggered by weak guidance.
Next, the Relative Strength Index (RSI) is retreating from an overbought condition.
Traders looking for continuation lower may now watch for a potential break of the trendline along the lows of 2023.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com/important-information.
