After breaking below the simple moving averages on the daily time frame earlier this year, AMZN share prices have cemented their steady downtrend. After all the “Sell in May and go away” adage is starting to have an impact on equity prices before April comes to a close.
As you can see from the chart, AMZN share prices are showing signs of retracing from the latest drop. This offers potential sellers a chance to hop in the downtrend by placing short orders on nearby resistance zones.
AMZN Share Prices Forecast
A retracement could last until 340.00 to 350.00, as these psychological price points are in line with the 50 and 200 SMA crossover. This also lines up with a former support area at the 350.00 level, making it a good area to wait with sell orders for those bearish on AMZN share prices.
Take note that Amazon is set to release its earnings report today and possibly show 21% growth in revenues as Wall Street analysts expect. Lower earnings could trigger a selloff for AMZN share prices until the end of the week.
Another factor worth noting is that Amazon Prime membership has increased in price from $79 to $99 and this might’ve wound up discouraging new members. If so, the effect might be seen as early as this quarter’s earnings release and impact AMZN share prices if they do show a decline in sign-ups.
On the other hand, upbeat earnings data could trigger a strong rally for share prices and possibly give it a boost close to the latest highs. This is a less likely scenario though and it would take a considerably strong report to push for rallies above the 350.00 mark, thereby shifting the stock price in an uptrend.
To contact the reporter of the story: Jonathan Millet at email@example.com