Amazon stock hit a near one-month low on Friday after both the 100- and 200-day simple moving averages (SMA) blocked the latest upswing. The stock has been in retreat after peaking at the three-month high of 113.53 on February 2, but it had started to show some signs of life last week after notching up three days of gains.
The momentum indicators reinforce the weakening bias as the stochastics have just posted a bearish crossover, while the MACD continues to slide towards zero below its red signal line.
Should the price head further south, there could be support from the 50-day SMA in the 93.00 area. If this support fails to hold, it will clear the way towards the January low of 80.97, while a break below it would signal a resumption of the longer-term downtrend.
However, if the stock manages to bounce higher and rise above the 100- and 20-day SMAs at 98.34 and 100.13, respectively, the positive momentum would likely gather steam and the rebound should then extend until the 38.2% Fibonacci retracement level of the August 2022-January 2023 downleg at 105.85.
Even higher, the main target is the February top of 113.53, which lies right on the 50% Fibonacci level. A climb above the 50% Fibo would mark the start of a shift in the medium-term outlook from bearish to bullish as this would also take the price above the longer-term descending trendline.Summing up, the short-term bias has become slightly negative after the latest pullback, but there is still some hope for the bulls to turn things around. In the bigger picture, the stock needs to pierce above the descending trend line to switch the outlook to bullish, while a revisit of the January trough would reinforce the downtrend.