Watch These Amazon Price Levels as Stock Drops on Sales Outlook

Amazon (AMZN) shares fell sharply successful premarket trading Friday aft nan e-commerce elephantine reported weaker-than-expected quarterly gross and issued light current-quarter guidance, arsenic consumers opted to acquisition cheaper products, lowering nan mean trading value successful its halfway unit business.

Although the company's banal reached a grounds precocious past month, investors person been speedy to book profits successful nan weeks since amid increasing concerns complete expanding title from discount e-tailers and a slowdown successful user spending arising from lingering ostentation and higher liking rates.

Shares were down 7.9% astatine $169.50 successful caller premarket trading.

Below, we return a person look astatine Amazon’s floor plan and usage technical analysis to find important value levels investors whitethorn beryllium watching.

Bearish Engulfing Pattern

Amazon shares person trended mostly higher since nan 50-day moving mean (MA) crossed supra nan 200-day MA successful May past twelvemonth to make a golden cross bargain signal. However, aft climbing to a caller grounds precocious past month, nan banal promptly shifted into trading mode, raising nan anticipation of a imaginable bull trap.

In different bearish improvement starring into nan online retailer's quarterly results, nan value rallied supra nan 50-day MA successful Thursday’s trading convention earlier staging an intraday reversal to adjacent beneath yesterday’s low, completing a bearish engulfing pattern successful nan process. This two-bar candlestick statement warns of a displacement successful marketplace psychology, starring to little prices.

Monitor These Key Support Levels

Following nan stock’s earnings-driven selling, investors should show 4 cardinal value levels that could supply support.

Initially, it’s worthy watching if nan banal tin clasp $170, an area connected nan floor plan apt to pull buying liking adjacent a confluence of support from nan rising 200-day MA and an established uptrend statement that joins respective salient swing lows betwixt December 2022 and October past year.

The adjacent location to watch sits conscionable $9 little astatine $161, wherever nan shares whitethorn find support astir a precocious January highest that formed respective days earlier nan Feb. 2 net breakaway gap.

An inability to clasp this level could spot a diminution to $145, wherever buyers whitethorn activity entry points adjacent a trendline that links nan awesome August 2022 and September 2023 value peaks pinch a play of constrictive consolidation successful November and December past year.

Finally, a deeper correction whitethorn spot nan shares trial nan $123 region, wherever they could brushwood support from a horizontal statement connecting galore peaks and troughs betwixt July 2022 and October 2023.

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As of nan day this article was written, nan writer does not ain immoderate of nan supra securities.