A familiar look is returning to market leaders, but this time it’s not from the usual suspects. While much of the talk surrounding the Magnificent Seven has focused on Nvidia’s $5 trillion valuation and Apple’s new highs, one member of the group is quietly assembling one of the most powerful technology structures on the board. It’s no secret that you can’t spell “Amazing” without AMZN. In a market that changes hands, stalls, and reshuffles, Amazon is starting to look like the next stock ready to step back into the spotlight. The e-commerce and cloud computing giant has spent much of the past two years burning through huge profits, but consolidation appears to be on the way. Improving relative strength, strong momentum buy signals, and investors re-energized by the idea that Amazon could be one of the biggest beneficiaries of the next phase of its artificial intelligence buildout are pushing the stock back toward higher highs. The chart speaks louder and to this techie, it sounds like an opportunity with a great risk/reward setup worth considering. Setup Let’s analyze it over multiple time frames to show the potential for future upside. Short Term First, we will demonstrate the significance of recent price movements by examining the daily chart for a year. In the short term, the price has formed a head-and-shoulders reversal pattern that has reversed below the previous resistance level, or neckline. The stock just broke above this resistance and closed above its 50-day moving average. This is the momentum we want. Speaking of momentum, we also saw a bullish divergence in the RSI from the left shoulder of the pattern to the low. The stock hit new lows, but momentum is shifting, another good sign for bulls. Adding to the positive theory was a bullish MACD crossover buy signal that occurred when the stock turned higher from its recent lows. Let’s analyze the long-term 5-year weekly chart. As a shareholder, and considering it’s a core holding in my personal portfolio, my real focus is on that extended time frame. When you look back at a chart over a longer period of time, you can truly see the importance and power of the trend. On a weekly basis over the past five years, we can see that the stock price had a significant upward trend until it stabilized at the 1.618 Fibonacci extension level. Let me explain. Using the November 2021 peak to January 2023 bottom as an anchor, we set Fibonacci targets at ~$254 (1.618) and ~$360 (2.618) after breaking new highs in late 2023. The first target was met as the stock stopped just below the 1.618 extension line not once but three times. Now we have surpassed that goal again. From a momentum perspective, the RSI has painted a clear picture over the past five years. Bullish divergence from 2021 to 2023 before trend change. Things are currently trending in the right direction, far from an overbought situation, and there is momentum to support recent moves. That means you have room to run. Finally, let’s look at it in relative terms and compare it to the consumer discretionary sector (XLY). The last time AMZN/XLY broke above the 50-period moving average, AMZN rose approximately 82% to its all-time high before consolidating and digesting much of its gains. It is now further above the 50-period relative strength moving average, with a potential retest from above as new support, supporting the narrative that AMZN is outperforming its discretionary peers. Trading For short-term traders, use the recent gap and the level just below the previous resistance near $245 as stops. The upside target of $270 is easily achievable. Factoring in the breakout puts the stock just below its recent high. For long-term investors, trends are your friend. The weekly candlestick is trading above the resistance level, but we need to see if it can sustain this level. If that happens, as I expect, the Fibonacci-based long-term upside price target would be $360. The downside risk to watch for is a break below the long-term uptrend around $220. If a long-term trend breaks, it may be time to reevaluate the stock. Overall, Amazon offers new opportunities to deliver profits to both short-term traders and long-term investors. —Jay Woods, CMT at Chase Games Disclosure: Amazon is owned by individuals and families All opinions expressed by CNBC Pro contributors are solely their own and do not reflect the opinions of CNBC, its parent or affiliates, and may have been previously disseminated on television, radio, the Internet, or another medium. This content is provided for informational purposes only and does not constitute financial, investment, tax, or legal advice or a recommendation to purchase any securities or other financial assets. 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