Amazon.com, Inc. (AMZN) This week’s Prime Day 2020 didn’t seem to have the clout of past events as the stock fell more than 200 points after a rapid run-up on Monday. The sell-the-news response underscores that area-bound The ribbon has been in place for the past three months, and the e-commerce juggernaut crossed the $ 3,250 level that marked the peak of the July 13 rally. This sideways movement could last until October 29th Results report.
The central theses
- Amazon stocks could be “rated for perfection” after doubling March lows.
- Political headwinds could undermine the upward trend in the coming years.
- So far, there is little technical evidence that the 2020 rally is coming to an end.
Classic market customers warn traders and investors that “the bigger the step, the broader the base”. Amazon stock has posted a staggering 100% return since its March low, while 2020 to date marks the best year in its 23-year public history, suggesting the stock may now be “rated for perfection”. This in turn increases the chances for a long period of time Stragglers Performance unless another super catalyst like the pandemic is changing consumer behavior.
The next presidential administration could also mark a crucial turning point for the $ 1.7 trillion giant, regardless of who wins the election. President Donald Trump is no friend of CEO Jeff Bezos, who also owns the Washington Post. It’s no better across the aisle because Democrats have made it clear that when they take control in November they will be dealing with monopoly practices by American mega-tech.
Wall Street’s consensus on Amazon is sheer perfection despite gains with a strong share price. The “Strong Buy” rating is based on 37 “Buy” recommendations. Not a single analyst covering the retailer has given it a “hold” or “sell” rating. Price targets Currently, they range from a low of $ 3,400 to a street high of $ 4,500, while the stock is set to open the session about $ 40 below the low on Friday. While higher prices seem inevitable given this placement, unanimity could mark a red flag.
ONE monopoly refers to when a company and its product offerings dominate an industry or industry. Monopolies can be seen as the extreme result of the free market capitalism Without constraints or restrictions, a single company or group becomes large enough to own all or almost all of the market (goods, supplies, goods, infrastructure, and assets) for a particular type of product or service.
Amazon Weekly Chart (2010-2020)
The stock hit the 2000 high of $ 113 in 2010 and traded in one rising channel that kept intact in a 2017 outbreak. The uptrend stalled just over $ 2,000 in September 2018, causing an interim correction, the one ascending triangle Template. It broke out in February 2020 but the rally failed and resulted in a vertical drop of more than 550 points. Market participants then saw the consolidation of retail power on some mega-caps and triggered a vertical recovery wave that hit previous highs in April.
An instant breakout quickly stalled near $ 2,500, yielding a small platform, followed by a strong rally impulse that extended to $ 3,250 in July. The stock broke that barrier in August, hit an all-time high of $ 3,552 in September, and failed the breakout a few days later. The subsequent decline to $ 2,871 broke the July 24th low, marking the first 100% retracement in the six month uptrend and setting off a red flag that is still in place.
Accumulation distribution The indicators peaked at the July high and have fluctuated sideways for the past three months. This is classic behavior during a correction phase, but the stock is still in weekly and monthly buy cycles stochastic oscillator. This in turn suggests that market participants will continue to buy weakness and sell strength in the late October earnings report.
ONE stochastic oscillator is a momentum indicator that compares a specific one Closing price of a security at a range of its prices over a period of time. The oscillator’s sensitivity to market movements can be reduced by adjusting this time period or by taking a moving average of the result. It is used to generate overbought and oversold trading signals using a range of values limited from 0 to 100.
The bottom line
Amazon shares have entered a correction phase, but so far there is little evidence that the strong upward trend is coming to an end.
Disclosure: The author held no positions in any of the above securities at the time of publication.