Online retail giant Amazon.com has had a great year. In fact, Amazon proved to be one of the most essential businesses in the market amid COVID-19, with many depending on its quick delivery times and vast inventory.
While Amazon’s stock is up 68% this year, it’s down about 10% from its late summer highs. A rotation out of tech and into more “recovery” stocks has occurred recently, so now may be a good time to give the stock a new look.
Recently, Amazon launched two new retail ventures that could become growth engines beyond 2020. One is Amazon Pharmacy, which allows consumers the option of getting their prescriptions quickly and securely through Amazon’s site. Amazon Pharmacy will offer free two-day delivery to Prime members, with discounts up to 80% on generic medications and up to 40% off brand-name medications, and saving customers money whether or not a prescription is covered by insurance.
As second innovation is the introduction of Amazon Fresh, Amazon’s new grocery store concept that offers a smart “Dash Cart” enabling cashier-less checkout. The story has flown somewhat under the radar this year, as Amazon has only opened its first pilot store in Thousand Oaks, CA, with many investors focused on e-commerce amid the pandemic.
Still, the new concept is potentially disruptive to physical grocery stores. In a low-margin, high-turnover business like groceries, eliminating a key cost and traffic constraint could set Amazon Fresh apart. The new store concept may also include a physical pharmacy that ties in with Amazon online pharmacy as well.
While the pandemic has clearly boosted online and delivery businesses, a large majority of grocery and pharmacy purchases are still made in physical stores. Amazon knows this and is wisely using its current profit windfall to roll out its physical store footprint for post-pandemic days ahead.
Amazon.com, Inc. offers a range of products and services through its Websites.
The Company’s products include merchandise and content that it purchases for resale from vendors and those offered by third-party sellers. It also manufactures and sells electronic devices.
It operates through three segments: North America, International and Amazon Web Services (AWS). Its AWS products include analytics, Amazon Athena, Amazon CloudSearch, Amazon EMR, Amazon Elasticsearch Service, Amazon Kinesis, Amazon Managed Streaming for Apache Kafka, Amazon Redshift, Amazon QuickSight, AWS Data Pipeline, AWS Glue and AWS Lake Formation.
AWS solutions include machine learning, analytics and data lakes, Internet of Things, serverless computing, containers, enterprise applications, and storage. In addition, the Company provides services, such as advertising.
It also offers Amazon Prime, a membership program that includes free shipping, access to streaming of various movies and television (TV) episodes.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 3,111.83.
The projected upper bound is: 3,338.04.
The projected lower bound is: 2,858.55.
The projected closing price is: 3,098.30.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 29.1325. This is not an overbought or oversold reading. The last signal was a sell 10 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 45.82. 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 sell 56 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 -58. This is not a topping or bottoming area. The last signal was a buy 8 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 9 period(s) ago.
Rex Takasugi – TD Profile
AMAZON COM closed down -1.010 at 3,098.390. Volume was 100% below average (consolidating) and Bollinger Bands were 20% narrower than normal.
Open High Low Close Volume 3,116.698 3,139.745 3,065.460 3,098.390 2,041
Technical Outlook Short Term: Neutral Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 3,109.85 3,162.25 2,716.57 Volatility: 31 48 50 Volume: 3,565,437 5,078,196 5,190,734
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.
AMAZON COM is currently 14.1% above its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods.
Our volume indicators reflect volume flowing into and out of AMZN.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on AMZN.O and have had this outlook for the last 9 periods.