Amazon Analysis and Market PredictionHello everyone, as we all know the market action discounts everything :)
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Amazing has been under a correction wave that affected the entire stock market, the stock price dropped from 3420.58 to 2714.06 in 2022 so far. with a bigger bearish movement to be expected in this year so we can tell that prices have been falling strongly lately, it is better to avoid new long positions here.
AMZN is part of the Internet & Direct Marketing Retail industry. There are 85 other stocks in this industry. AMZN outperforms 85% of them, and AMZN has an average volume of 3392180 This is a good sign as it is always nice to have a liquid stock.
Both the long and short-term trends are negative. It is better to avoid buying stocks with negative trends.
AMZN is currently trading in the lower part of its 52-week range, which is not a good signal. Agreed, the S&P500 Index is also not doing fantastic, but it still sitting in the middle of its 52-week range.
Possible market movement :
AMZN is currently trading at 2792.75 with the market closing green yesterday, but we are still in the danger zone with different technical indicators giving us Bearish signs.
The markets seems to be headed to the support line located at 2639.83 where we might see a bounce back up if the Bulls were able to take control over the market, but the bulls might try to do an early push as we have seen some signs of a Bullish movement, and the first target will be the resistance level located at 2966.49, and at that level, a battle will happen between the Bulls and Bears over control that will determine the direction of the market.
Technical indicators show:
1) The market is below the 5 10 20 50 100 and 200 MA and EMA (Strong Bearish Sign)
2) The RSI is at 23.25 and now trading in the oversold zone which could indicate a small push in the value of the stock.
3) The ADX is at 39.26 showing a trending market, but a negative crossover is showing between DI+ (9.48) and DI- (36.93).
Support & Resistance points :
support Resistance
1) 2714.64 1) 2871.97
2) 2651.85 2) 2966.49
3) 2557.32 3) 3029.29
Fundamental point of view :
AMZN has a Return On Assets of 6.87%. This is better than the industry average of -3.74% and the Profit Margin of 5.73% is amongst the best returns of the industry. AMZN outperforms 81% of its industry peers. The industry average Profit Margin is -4.08%.
When comparing the current price to the book value of AMZN, we can conclude it is valued correctly. It is trading at 11.75 times its book value and The Earnings Per Share has grown by an impressive 49.69% over the past year.
The Federal Reserve is clearly out to tame inflation and reckons a "historically tight" labor market gives it plenty of room to raise rates without hurting jobs growth, January jobs data out Friday will likely confirm that view. Economists polled by Reuters forecast the U.S. economy created 238,000 new jobs versus 199,000 in December when the employment rose less than expected due to worker shortages.
Proof of a tighter jobs market and wage gains may fuel further bets on how aggressive the Fed will be, markets now anticipate roughly five quarter-point rate hikes by year-end.
This is my personal opinion done with technical analysis of the market price and research online from Fundamental Analysts and News for The Fundamental point of view, not financial advice.
If you have any questions please ask and have a great day !!
Thank you for reading.
