US Stock Focus Amazon rebounded from key medium term support

Medium-term technical outlook on Amazon.com (AMZN)

Key technical elements

• The recent decline of 13% from its current all-time high of 1083.31 printed on 27 July 2017 has managed to stall at a key medium-term support of 936.30.
• The aforementioned key medium-term support of 936.30 is defined by the lower boundary of the ascending channel in place since 14 November 2016 low and the 38.2% Fibonacci retracement of the on-going multi-month uptrend in place since 14 November 2016 low to 27 July 2017 high.
• The daily RSI oscillator has managed to inch up from its corresponding support at the 45% level after it posted a bullish divergence signal. In addition, it still has further potential upside before it reaches an extreme overbought level. These observations suggest that medium-term upside momentum of price action remains intact.
• The next significant resistance stands at 1167.00 which is defined by the upper boundary of the medium-term ascending channel in place since 14 November 2016 low and the 0.618 Fibonacci projection of the up move from 09 February 2016 low to 06 October 2016 high projected from 14 November 2016 low.

Key levels (1 to 3 months)

Intermediate support: 960.60

Pivot (key support): 936.30

Resistances: 1083.31 & 1167

Next support: 856.40/847.20

Conclusion

Therefore, as long as the 936.30 key medium-term pivotal support holds, Amazon may resume its bullish impulsive upleg within its on-going medium-term uptrend in place since 14 November 2016 low to retest its current all-time high level of 1083.31. A break above 1083.31 opens up scope for a further potential up move to target the next resistance at 1167.

On the other hand, failure to hold above 936.30 is likely to put the medium-term uptrend in jeopardy for a deeper corrective decline towards the next support at 856.40/847.20 (the former swing high area of 06 Oct 2016).

Chart is from eSignal

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