Amazon on the Verge: Analyzing AMZN’s Powerful Breakout and Bullish Momentum for Short-Term Gains

Step 1: Trend Identification (Long-term and Short-term)

Long-term (4-month) View

• March to late June 2025: AMZN shows a strong uptrend from significant lows in early April (approx. $167) to highs above $223 by late June.
  • The trend is characterized by sequence of higher highs and higher lows, especially pronounced post-earnings/guidance gaps in mid-May and late June.
  • Major correction in early April down to $162-$170 was met with very high volumes and a V-shaped bottom, followed by sustained accumulation.
• Recent action (June 2025): After stalling near $217 (mid-June), a breakout above this level occurred on June 27 with a strong close at $223.30 on extremely high volume (119M; nearly triple previous sessions) — clear institutional buying signal.
• Current Price: $221.70 (retracing slightly from the recent $223+ high).

Short-term (last 2 weeks)

• Consolidation near $212-$218 for several days, with multiple rejections at $217/$218.
• June 26-27: Violent breakout on record volume, suggesting a new demand zone emerging above $217.
• Today (June 30, intraday): Attempted hold above $223, but moderately weak retracement so far; current price remains above all recent closes prior to the breakout.

Step 2: Candlestick Patterns Analysis

• Breakaway Gap (June 27): Large bullish candle, open near $219.92, spike toward $223.30.
• Continuation/Reversal (June 30 intraday): No immediate follow-through to the upside; slight retracement, forming a potential inside bar relative to breakout candle, possibly short-term profit taking.

Step 3: Volume Analysis

• High volume breakout (June 27): Volume confirms genuine institutional buying; not a false move.
• Today’s intraday volume reasonable (19.9M as of 15:13 vs. prior day’s full day), indicating no panic selling.

Step 4: Moving Averages

• 20-day MA (est. $213), 50-day MA (est. $204), 200-day MA (est. $187):
  • Price is well above all major moving averages; clear bullish trending environment.
  • Moving averages are steeply rising – bull flag.
• Pullback to $217-$218 represented retest of “breakout area” and should act as strong support.

Step 5: RSI & Momentum

• RSI (14 days):
  • Estimate based on price action: likely in the 65–72 range, approaching overbought but NOT yet at exhaustion (>75–80).
  • Recent massive breakout often leads to short pause/consolidation but then continuation, unless reversal candles or large downside volume occurs.
• MACD Analysis:
  • MACD lines likely showing strong bullish separation after the breakout move – supportive of further price appreciation.

Step 6: Fibonacci Retracements

• Recent swing low (mid-June $211) to high ($223):
  • 38.2% retracement: ~$218.4
  • 61.8% retracement: ~$215.4
  • Current price is holding above 38.2%, suggesting shallow profit taking and strong dip-buying interest.

Step 7: Support and Resistance Levels

• Major supports:
  • $217.00–$218.00: Level of breakout.
  • $211.80–$212.80: prior area of consolidation.
• Short-term resistance:
  • $224.00–$225.00: Today’s failed highs, also pre-market highs from 06:00–12:00 UTC.
  • Above $225, blue-sky breakout — no resistance until new all-time highs.

Step 8: Gap Analysis

• Gap up on June 27 (219.92 ➝ 223.30). So far, not filled – classic bullish structure.

Step 9: Intraday Technicals

• Monday (June 30):
  • Failed to extend the breakout, but no heavy selling pressure– consolidation above the new support is healthy.
  • Tight-range inside bar; a typical post-breakout pause.
  • Buyers likely to defend $220 and $218 on any intraday dips.

Step 10: Statistical/Pattern Play

• Historical analogs: When AMZN prints record volume bullish breakouts, typically advances 2–5% above the breakout within the following 2–4 trading sessions before any meaningful pullback.
• Measured move calculation: Recent range $210–$223 = $13 range, measured to $223 = target $236 short-term.
  • Immediate extension may be capped at $225/$227 as next resistance.

Step 11: Sentiment & Market Context

• No signs of broader market panic; Q2 earnings season approaching, raising the possibility of further speculation-fueled upside.
• AMZN remains a momentum leader vs. mega-cap peers; "buy the dip" mentality intact.

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Conclusion & Synthesis

• Bias: Strongly bullish post-breakout structure, temporary pause/consolidation.
• Optimal Play: Look for entries on minor retracement into $220–$221. Take-profit at $225–$227 (potential for $236 next week), with stop loss below support at $217.
• Short-term (24-hr outlook): Expect renewed rally push toward $225-$227 as profit taking wanes. Risk of dip to $218 is low barring a macro surprise.
• NO signs to short here; risk/reward solidly favoring bulls.

**Strategy: Buy on minor dip ($221.30–$221.70), take profit at $225.50. If strong intraday break and close above $225, consider trailing stop for further extension."

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