Despite Good Sales Data, Amazon Stocks Fall Below its 20-Day EMA

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Amazon.com, Inc. (NASDAQ:AMZN) slide on Thursday session below its 20-Day EMA of $336.04 on daily charts and the MACD crossover is also signaling that the trend for the stock is down in near term.

A report from ChannelAdvisor highlights that August went extremely well for sellers who preferred Amazon.com, Inc. (NASDAQ:AMZN) over eBay Inc (NASDAQ:EBAY). It is to be noted that ChannelAdvisor releases reports of its clients’ selling performance on various marketplaces, including Amazon.com, Google Shopping and eBay.

Amazon A Performer

In the month of August, Amazon’s same store sales grew 45.1% versus 40.4 % in July. Apart from this, increasing clients of ChannelAdvisor shipped products useing Fulfillment by Amazon program which surged to a level of 35.4% in August from 31.5% in July. The program allows retailers to store their inventory at Amazon’s warehouse and is directly delivered to the customer by Amazon rather than seller. Similarly, more merchants chose Amazon to deliver the products sold on their individual sites and such cases rose from 1.4% a year back to 1.9% now.

eBay Sales Shrink

On the other hand, eBay drew just the opposite picture reporting a sharp drop in its growth month-over-month. The retailer just reported a growth of 5.9% in August compared to 9.7% in July. Fixed price sales too recorded a growth of 6.9% as against the growth a year back. ChannelAdvisor’s CEO, Scot Wingo outlined a number of reasons that hurt the retailer’s growth. First of all, eBay is still overcoming the impact of the breach that happened in May. Secondly, a change in Google’s search algorithm should have also kept a number of eBay’s pages away from the search. Google changed its search approach in May to give way to better and high quality web sites that have better organic search results ranking. Another dampener for eBay is its introduction of ‘eBay Defect Rate’ in August, which is designed to penalize those sellers who have a high rate of customer returns. The policy prevented a lot of sellers to keep off from the marketplace in the month eventually.

Actionable Insight

Sell Amazon.com Inc. (NASDAQ:AMZN) for target of $327, $320 with stoploss of $336.

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Deepak Tiwari, a law graduate, has been working as a journalist for six years now. He currently writes on Bitcoin, economic, and Forex related news at ForexMinute, the brand new financial news portal which is making waves among Forex traders around the globe for the innumerable Forex resources it offers for readers, traders and brokers. His other specialties include writing on law & governance, finance, internet marketing, careers, politics, international relations & diplomacy, etc.