Chart of the Day: Amazon Is Down, But Not Out
An AWS outage caused major headaches, but the stock remains a buy. Here's why.
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It's been a tough month for Amazon (AMZN) .
The stock hit a speed bump in early September and has been falling steadily. The chart is now bearish on the GoNoGo composite of indicators at the top of the chart. The Moving Average Convergence Divergence, as seen in the second pane, is bearish, and the Average Directional Index, in the third pane, is turning higher. These indicators show the trend, which is down, is strengthening. That's the bad news.
The good news is stochastics, as seen in the second-to-bottom pane, are oversold. Also money flow, as seen in the bottom pane, is improving, the best position of Chaikin money flow in a month. Volume trends are neutral, the recent selling has been on weaker turnover, which means a lack of selling conviction.
Earnings are coming up soon and while the anticipation is high for this company, estimates are not outrageous. Amazon has been the worst performing Mag 7 stock over the last month and is due for a recovery.
We like Amazon at TheStreet Pro Portfolio and rate it a one, buy at anytime.
