NASDAQ:AMZN may be ready to breakout.

Our stock screener has spotted AMAZON.COM INC (NASDAQ:AMZN) as a possible breakout candidate. A technical breakout setup pattern occurs when the stock is consolidating after a nice uptrend. Whether the actual breakout occurs remains to be seen of course, but it may be interesting to keep an eye on NASDAQ:AMZN.

Zooming in on the technicals.

ChartMill assigns a proprietary Technical Rating to each stock. The score is computed daily by evaluating various technical indicators and properties. The score ranges from 0 to 10.

Overall AMZN gets a technical rating of 10 out of 10. Both in the recent history as in the last year, AMZN has proven to be a steady performer, scoring decent points in every aspect analyzed.

• Both the short term and long term trends are positive. This is a very positive sign.
• Looking at the yearly performance, AMZN did better than 92% of all other stocks. We also observe that the gains produced by AMZN over the past year are nicely spread over this period.
• AMZN is part of the Broadline Retail industry. There are 34 other stocks in this industry. AMZN outperforms 90% of them.
• AMZN is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month AMZN has a been trading in a tight range between 171.47 and 181.41.

For an up to date full technical analysis you can check the technical report of AMZN

Why is NASDAQ:AMZN a setup?

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for NASDAQ:AMZN is 8:

Besides having an excellent technical rating, AMZN also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 179.72. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 178.22, a Stop Loss order could be placed below this zone.

How can NASDAQ:AMZN be traded?

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

Of course, there are many ways to trade or not trade NASDAQ:AMZN and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

Every day, new breakout setups can be found on ChartMill in our Breakout screener.

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.