Amazon.com, Inc. (NASDAQ:AMZN) global e-commerce empire will be mightier

Amazon.com, Inc. (NASDAQ:AMZN) global e-commerce empire will be mightier

Amazon.com, Inc. (NASDAQ:AMZN) global e-commerce empire will be mightier

E-commerce’s current approximately 10% share of U.S. retail sales will continue to increase, with a similar dynamic occurring in international markets. Amazon will continue to be the prime (pun intended) beneficiary of the growing size of the sector pie. Not only do many people love the convenience of shopping online, but they specifically love Amazon, thanks largely to its massive selection and loyalty program, Prime. In fact, Amazon captured nearly 50% of all e-commerce sales in the United States in 2018. That means it had a roughly 5% share of total U.S. retail sales last year. 

Amazon Web Services (AWS) will be much bigger

Amazon Web Services (AWS) is the dominant player in the fast-growing cloud computing service market. In 2018, it had a 32% market share of this $80 billion global market, which grew 46% year over year, according to market research firm Canalys. 

The cloud service space is widely expected to continue to grow rapidly, and there’s every reason to believe that AWS will still be the market leader in 2024. If this proves the case, Amazon’s operating income should continue its upward climb. In the first quarter, the ultra-profitable AWS generated just 13% of the company’s overall revenue, but 50% of its total operating income. 

Amazon will be disrupting the U.S. pharmacy market 

In 2024, Amazon should be well on its way to disrupting the approximately $400 billion U.S. pharmacy market. Last year, the company bought online pharmacy PillPack, giving it the ability to speedily deliver prescription drugs across the country.

It will enter the U.S. marijuana market as soon as federal legalization occurs

I can’t predict when marijuana will be legal on a federal level in the U.S., but once it is, look for Amazon to enter the market. Its initial move will probably be carrying cannabis products at its Whole Foods stores and making select ones available for free two-hour delivery via its Prime Now service.

Amazon is doing just this with alcohol — beer, wine, and (in some cases) spirits — in select cities. So, it has procedures in place to deliver regulated products.  

It will be using or on the cusp of using self-driving vehicles 

In 2024, fully autonomous vehicles should be legal across the U.S. or at least fast approaching receiving the federal green light. Look for Amazon to be an early adopter of driverless vehicles for at least some portions of its delivery operations. It might also be using drones — or on the verge of doing so — for some deliveries from its fulfillment centers to customers.

An Amazonian list of ways to grow

Amazon’s other existing businesses, including its advertising and Alexa-powered smart-home businesses, should also be notably larger in five years. The company will also continue to expand into entirely new businesses. 

What about Amazon’s stock price?

Nobody can predict with any degree of accuracy the stock price of any company five years out. There are too many variables, including the states of the stock market and the economy. However, if you invest in the right companies, stock prices should take care of themselves over the long haul.

For whatever it’s worth, Wall Street expects Amazon to grow earnings at a torrid average annual pace of 94% over the next five years. 

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 1,850.01.

The projected upper bound is: 2,027.58.

The projected lower bound is: 1,859.89.

The projected closing price is: 1,943.73.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 25 white candles and 25 black candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 96.4412. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 14 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 63.77. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 22 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 139.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 11 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 18 period(s) ago.

Rex Takasugi – TD Profile

AMAZON COM closed up 3.910 at 1,942.910. Volume was 36% below average (neutral) and Bollinger Bands were 26% narrower than normal.

Open High Low Close Volume___
1,928.6001,945.9001,925.3001,942.910 2,628,359

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period     50-period     200-period
Close: 1,913.76 1,872.70 1,745.05
Volatility: 17 29 46
Volume: 2,702,318 4,103,864 5,486,800

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

AMAZON COM is currently 11.3% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into AMZN.O (mildly bullish). Our trend forecasting oscillators are currently bullish on AMZN.O and have had this outlook for the last 12 periods.

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