Held Its 200-Day Moving Average On Monday’s Selloff

Amazon AMZN gapped below its 50-day simple moving average at $3,450 on Monday’s open. The day’s low was $3,305.01 versus its 200-day simple moving average at $3,304.15. Today the stock is trading back and forth around its monthly pivot at $3,363.74.

The online shopping giant set its all-time intraday high of $3,773.08 on July 13 and this day was a key reversal day with the close of $3,677.36, below the July 12 low of $3,696.79.

Today there was a report by the Motley Fool that indicated that Amazon is raising the cost of its ad prices. This will result in increased profits in upcoming quarters. is not cheap. Its p/e ratio is 60.35% and the company does not pay a dividend. Amazon has beaten earnings-per-share estimates in five consecutive quarters.

The Daily Chart for

The daily chart for Amazon shows the stock above a golden cross that was challenged between April 15 and May 5. Today the 50-day simple moving average is $3,435.96 and the 200-day simple moving average at $3,304.10. Monday’s volatile day was between these averages.


There are five horizontal lines. The top line is the semiannual risky level at $3,700.62. This line was tested as the price to book profits between July 7 and July 26. Shares of Amazon broke below the next two horizontal lines on a negative reaction to earnings reported after close on July 29. These lines are the quarterly pivot at $3,589.11 and the monthly pivot at $3,363.74.

The 200-day simple moving average was tested as a buying opportunity at $3,273.95 on August 16. This moving average was nearly tested at $3,304.10 on Monday, September 20.

The Weekly Chart for

The weekly chart for Amazon is neutral with the stock below its five-week modified moving average at $3,405.34. The stock is well above its 200-week simple moving average or reversion to the mean at $2,255.94. The 12x3x3 weekly slow stochastic reading is rising at 40.81.

Trading Strategy: Buy shares of Amazon on weakness to its 200-day simple moving average at $3,304.04. Reduce holdings on strength to its quarterly pivot at $3,589.11.

The Tycoon Herald