Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Here's How Amazon's Chart Looks Following 20-1 Stock Split

Stock Markets Jun 06, 2022 17:40
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. Here's How Amazon's Chart Looks Following 20-1 Stock Split, Inc (NASDAQ: NASDAQ:AMZN) appeared to be trading more than 94% lower in the premarket, but the new $125 price tag on the stock is due to a 20-1 stock split, which took effect on Monday after being announced in March.

The stock split prompted analysts to adjust their price targets on Amazon, with Morgan Stanley (NYSE:MS) maintaining its Overweight rating and adjusting the price target to $175 and MKM Partners maintaining its Buy rating on the stock and adjusting the price target to $180.

Amazon’s adjusted share price makes investing in the stock more affordable for retail traders, and on Monday Amazon was shooting up almost 5% higher, which caused the stock to break up from a bull flag pattern on the daily chart.

The bull flag pattern is created with a sharp rise higher forming the pole, which is then followed by a consolidation pattern that brings the stock lower between a channel with parallel lines or into a tightening triangle pattern.

  • For bearish traders, the "trend is your friend" (until it's not) and the stock may continue downwards within the following channel for a short period of time. Aggressive traders may decide to short the stock at the upper trendline and exit the trade at the lower trendline.
  • Bullish traders will want to watch for a break up from the upper descending trendline of the flag formation, on high volume, for an entry. When a stock breaks up from a bull flag pattern, the measured move higher is equal to the length of the pole and should be added to the lowest price within the flag.
A bull flag is negated when a stock closes a trading day below the lower trendline of the flag pattern or if the flag falls more than 50% down the length of the pole.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

See Also: Amazon Stock Begins Trading On Split-Adjusted Basis: What Investors Need To Know

The Amazon Chart: Amazon’s bull flag pattern was created between May 24 and Friday, with the pole formed between May 24 and June 1 and the flag printed over the two trading days that followed. The measured move the break from the pattern is 23%, which indicates Amazon could soar up toward the $148 level in the future, although retracements to form higher lows are likely along the way.

  • Amazon’s higher prices on Monday caused the stock to confirm it’s now trading in an uptrend, with the most recent higher high printed on June 2 at $125.51 and the most recent higher low formed at the $120.05 mark on that same day. Bullish traders looking to enter a position may choose to wait until Amazon forms its next higher low and prints a reversal candlestick above the $120 level in order to take a position.
  • Bearish traders want to see big bearish volume come in and drop Amazon down to form a lower low, which would negate the uptrend and indicate more downside is in the cards. Although the stock has confirmed an uptrend on the daily chart, Amazon is still trading in a downtrend on the weekly chart.
  • Amazon has resistance above at $131 and $136.83 and support below at $125.93 and $122.24.
See Also: How to Read Candlestick Charts for Beginners

© 2022 Benzinga does not provide investment advice. All rights reserved.

Read at Benzinga

Read the original article on Benzinga

Here's How Amazon's Chart Looks Following 20-1 Stock Split

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email