After a rough year-start due to anticipated Fed policy tightening and the Ukrainian war, big tech stocks are making a comeback. On the eve of a rate hike by the Fed, the tech-heavy Nasdaq 100 rose more than 3%. The gain defied the odds that an economic tightening would hit technology stocks.
Amazon.com, Inc. (NASDAQ:AMZN) stock is one that made a comeback on Thursday, gaining more than 1%. It is the same day that the e-commerce giant completed the acquisition of MGM Studios for $8.45 billion.
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The deal was the second-largest acquisition and underlined Amazon’s desire to diversify into the entertainment business. After recent selloffs, this theses postulates that the tech stocks are already oversold, and Amazon could ride on a bullish reversal to $3,219.
AMZN clears resistance at $3,000
At the current trading of $3,088, AMZN has effectively cleared the resistance at $3,000. Technically, this sets the stock to a price rally to the next resistance at $3,219.
Looking at the daily chart, the 50-day moving average has joined the support for AMZN, which sets it for a robust bullish move. We believe the $3,219 level is key to watch/target as it remains the established resistance. It is the same region where the price may meet the 100-day MA, and buyers could exit positions once it is hit.
For short-term to medium-term trading, $3,219 remains the target. We need to wait for the stock to clear $3,219 before considering higher levels of $3,400, $3,600, and $3700 possible.
Summary
Amazon is a buy after clearing the $3,000 resistance. The stock will rise up to the resistance of $3,219. Traders can buy at the current level or on a short retracement towards the $3,000 support.
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