Overall, Amazon Inc. continues to trade above its medium-term upwards moving trendline, taken from the low of the 4th of April. As long as the line remains intact, we will stick to the upside scenario and aim for the previous higher levels, or even new all-time highs.
Bearing in mind that the price continues to print higher peaks and higher troughs, we would consider this week’s sell-off as a good correction, before the stock could move back up again. The area to watch for a potential rebound could be the 1925 zone, marked by the high of the 13th of August. This is where the bulls could start jumping in and taking advantage of the lower price. If Amazon makes its way back up to the 1990 level and eventually breaks it, this could open the path towards the stock’s all-time high, at around 2050. If there will still be interest in the Amazon stock at that price, investor demand might drive the share into unchartered territories.
On the downside, a break below the aforementioned upside support line could set the stage for further declines and more bears could start joining in the action. A strong break and a close below the 1865 level could confirm this idea and this could open the path towards the 1820 area, or even the 1765 barrier, which acted as good support at the end of July.
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