Take Advantage of the Fundamental Gap in Amazon.com, Inc. (NASDAQ:AMZN) Stock

Take Advantage of the Fundamental Gap in Amazon.com, Inc. (NASDAQ:AMZN) Stock

Take Advantage of the Fundamental Gap in Amazon.com, Inc. (NASDAQ:AMZN) Stock

When you’re a small company, particularly an upstart tech firm, the law of small numbers works in your favor. If you’re only making $1 million in annual revenue, another million would represent 100% sales growth. That’s one of the reasons why penny stocks are so compelling: hit the right one and you’ll witness bonkers enthusiasm.

But what does $1 million mean to a company like Amazon? Today, such a lowly figure is a rounding error, if that. Hence, the bigger your organization becomes, the more likely that the law of large numbers works against you.

Yet some companies like Facebook (NASDAQ:FB) go against the grain. After reaching the one-billion active user benchmark, it quickly got to two-billion. Despite its size and age, Facebook’s growth metrics are simply more convincing than comparative upstarts Twitter (NYSE:TWTR) and Snap (NYSE:SNAP).

But if you’re not into social media, don’t worry: AMZN stock also moves in counter-intuitive fashion.

Having dominated ecommerce for several years, you’d expect revenue growth to conspicuously peak. Instead, sales growth is noticeably increasing, which easily bolsters the long-term case for Amazon stock.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 1,690.15.

The projected upper bound is: 1,860.85.

The projected lower bound is: 1,676.49.

The projected closing price is: 1,768.67.

Candlesticks

A black body occurred (because prices closed lower 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 27 white candles and 23 black candles for a net of 4 white candles.

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 36.0151. This is not an overbought or oversold reading. The last signal was a sell 2 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 60.11. 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 3 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 46. This is not a topping or bottoming area. The last signal was a sell 2 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 12 period(s) ago.

Rex Takasugi – TD Profile

AMAZON COM closed down -18.060 at 1,765.700. Volume was 29% below average (neutral) and Bollinger Bands were 9% narrower than normal.

Open High Low Close Volume___
1,784.1301,787.5001,745.6801,765.700 4,324,801

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

Moving Averages: 10-period 50-period 200-period
Close: 1,760.76 1,669.93 1,734.05
Volatility: 28 35 46
Volume: 5,498,161 4,897,125 5,689,336

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 1.8% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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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