A few weeks ago, Amazon stock was our Chart of the Day as we were looking at renewed strength in mega-cap tech stocks.
At the time, I was looking for a monthly-up rotation over the March high at $3,184. We got that and more, with Amazon ultimately running to $3,430. That was the post-earnings high and failed breakout attempt from earlier this year.
Now though, shares are at an interesting juncture. While the S&P 500 is looking a bit fatigued — something Danny Riley spoke about in the Opening Print — Amazon stock could still have some momentum left in the tank after it cools off a bit.
Bulls used the monthly-up rotation in Amazon stock to help fuel it over range resistance near $3,340.
However, $3,430 continues to act as resistance. I would like to see a slightly deeper pullback in the stock price now. Specifically, I’d like a dip down to $3,360-ish, which is prior range resistance and the 10-day moving average. To see prior range resistance turn into support would be a welcomed bullish development.
This one-two punch gives us a combo of support to buy into. If it fails, we’ll know pretty quickly and we can limit our losses. If it holds, we should see a quick bounce.
Ultimately, I want to see Amazon stock retest the $3,430 level. Above that opens the door to $3,500, then the all-time high at $3,552.
Perhaps earnings will ruin the fun — or perhaps it will kickstarts the next leg of the rally.