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Trends & Analysis
News
Is Amazon a best-buy for the holidays?
News
China stocks end mixed despite PBoC announcement
News
Asia stocks rise on prospects of Fed easing hikes
News
HP joins the tech layoff spree
News
Will the euro give the bulls 200 reasons to smile?
News
Best Buy shares spike amid upbeat Q3 print

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Asset Watch

Can Amazon create some holiday cheer?

 

Tuesday, October 11 2022

After the U.S. unemployment rate dipped to 3.5% on Oct. 7, the S&P 500 reacted with disdain. Moreover, with a resilient U.S. labour market poised to embolden an already hawkish Fed, ‘good news is bad news’ for risk assets.

 

Yet, with Amazon’s “Prime Early Access Sale” starting on Oct. 11, consumers doing their holiday shopping earlier should help bolster the company’s fourth-quarter earnings. The promotion will include “80% off select Fire TV smart TVs and up to 50% off select JBL, Sony and Bose ear buds, speakers and headphones.” On top of that, a new deal will launch every 30 minutes.

 

Amazon’s solid fundamentals paired with a technical backdrop that’s relatively constructive, given the current environment, could mean further weakness may be a buying opportunity.

The February 2022 high places next-level support near $109, and Amazon rallied before reaching this milestone in September. Likewise, Amazon filled the gap from its bullish July earnings report, so give-back has already occurred.

 

However, Amazon’s next challenge is $126. The level is near the May 2020 and June 2022 highs. But if successful, Amazon could attempt to recapture $136, which hovers near the early-June highs, as well as the January and March 2022 lows and the September 2022 highs. Also, Amazon’s 200-day moving average is $136.04, which adds confirmation.

 

As a result, could Amazon help ignite a Santa Clause rally, or will the bears play the Grinch for the remainder of 2022?


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