Amazon.com rallied sharply on some bullish news last week. But it may face some bearish patterns over the intermediate and longer terms.
First, consider the level around $3,175. AMZN bounced there in the second, third and fourth quarters of last year before breaking it this quarter. That could make some traders think it will become resistance.
Next is the trendline running along the December highs, flagged on January 3. Notice how AMZN formed a shooting star yesterday at both $3,175 and that trendline.
Third, the 50-day simple moving average (SMA) is bearing down from above. It also recently had a bearish “death cross” below the 200-day SMA.
Fourth, AMZN made a new 52-week low early in the New Year. It’s also gone more than six months without making a new high, unlike the broader market. That’s a potential sign of distribution by big investors.
Finally, the macro environment remains potentially difficult for high-multiple growth stocks as central banks around the world move to tighten monetary policy.
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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, consider the level around $3,175. AMZN bounced there in the second, third and fourth quarters of last year before breaking it this quarter. That could make some traders think it will become resistance.
Next is the trendline running along the December highs, flagged on January 3. Notice how AMZN formed a shooting star yesterday at both $3,175 and that trendline.
Third, the 50-day simple moving average (SMA) is bearing down from above. It also recently had a bearish “death cross” below the 200-day SMA.
Fourth, AMZN made a new 52-week low early in the New Year. It’s also gone more than six months without making a new high, unlike the broader market. That’s a potential sign of distribution by big investors.
Finally, the macro environment remains potentially difficult for high-multiple growth stocks as central banks around the world move to tighten monetary policy.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradingView is not affiliated with TradeStation Securities Inc. or its affiliates. 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. 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.
