Is Amazon stock price falling into the bounce zone?
Just as tech stocks lead on the upside, they are ahead on the downside. And this decline has not been particularly pleasant.
It’s a bear market. The Nasdaq fell more than 30% and well-known large-cap stocks fell.
One such stock is Amazon (AMZN). After peaking at $188, AMZN fell to the $100 level and is currently trading just above that level.
Today, we’re taking a wide-angle view and sharing why Amazon may have fallen into the bounce zone.
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Amazon stock price chart – “weekly”
Again, we just share the chart and let the price do the talking. Looking at AMZN, we can see that a distribution top has formed over the course of 20 months and the price has collapsed from there. This leaves significant air supply (areas where you would expect sellers).
Knowing this, a longer-term investor should be careful and selective in accumulating stocks over a longer period. And while a shorter-term trader should do the same, the likelihood of a tradeable bottom soon is higher than a lasting bottom. The chart below shows the $95-$100 area as prior resistance which has now become important support. This is the area I’m watching over the next few days/weeks and I wouldn’t be surprised to see a nice bounce develop.
The author may have a position in the titles mentioned at the time of publication. Any opinions expressed herein are solely those of the author and in no way represent the views or opinions of any other person or entity.