AMAZON is currently available at a reasonable valuation and is testing one of its important resistance and support levels.
On the 1D chart, it has clearly broken out of its downward-sloping parallel channel and tested support again on 15th Oct. This suggests AMAZON is ready to break out on the daily frame.
On the higher frame/ long term, it still has room for a drop to approx. 226 USD (-11%), which would be a bulk buy phase if it comes. With a reward of upside to 300-304 USD (+16.5%), where we will be seeing some profit booking and a long-term upside to 340- 350 USD (+33%).
So risk-reward doesn't seem very favourable for the short-term goal.
How should you be planning this AMAZON growth?
If you currently own nothing in AMAZON, this drop might be a preferable entry point with a risk-reward of -11% to +16%. And if it drops to a major buying phase, that might be a good point to have a significant part, max 5-10% of the portfolio, and wait for the turnaround.
Confirmation of the trade might come in the upcoming earnings call, which is on 29-30th Oct.
If the guidelines come as a positive: we might see a good rally, however, with a currently negative narration on the AI play, there might be a small correction pending to be completed before the rally.
If guidelines come negative: we might see a baseline touch scenario, which would be a good to purchase some part of the AMAZON stock purchased for the long term and keep some cash reserved for later confirmations.
On the 1D chart, it has clearly broken out of its downward-sloping parallel channel and tested support again on 15th Oct. This suggests AMAZON is ready to break out on the daily frame.
On the higher frame/ long term, it still has room for a drop to approx. 226 USD (-11%), which would be a bulk buy phase if it comes. With a reward of upside to 300-304 USD (+16.5%), where we will be seeing some profit booking and a long-term upside to 340- 350 USD (+33%).
So risk-reward doesn't seem very favourable for the short-term goal.
How should you be planning this AMAZON growth?
If you currently own nothing in AMAZON, this drop might be a preferable entry point with a risk-reward of -11% to +16%. And if it drops to a major buying phase, that might be a good point to have a significant part, max 5-10% of the portfolio, and wait for the turnaround.
Confirmation of the trade might come in the upcoming earnings call, which is on 29-30th Oct.
If the guidelines come as a positive: we might see a good rally, however, with a currently negative narration on the AI play, there might be a small correction pending to be completed before the rally.
If guidelines come negative: we might see a baseline touch scenario, which would be a good to purchase some part of the AMAZON stock purchased for the long term and keep some cash reserved for later confirmations.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.