Tale Of Two Catalysts For Amazon: Better FAA Drone Regulations And Key Technical Level Smashed

Amazon.com, Inc. AMZN shares rose nearly 3 percent on Wednesday, on two catalysts. Technical traders were attributing the stock's move above $600 as a key psychological level, while others were talking about a new report concerning FAA regulations on commercial drones.

FAA May Allow Small Commercial Drones

According to the Associated Press, the Federal Aviation Administration said it's working "quickly on regulations that would permit small commercial drones to fly over people and crowds" -- something that is presently not legally possible.

Amazon announced late last year plans to use small drones to deliver packages in 30 minutes or less to local consumers via a "Prime Air" delivery program. Amazon had, according to the AP, received the O.K. to test the drones for research, but commercial use had yet to be approved.

$600 Level Was Near-Term Resistance

Of course, not every investor trades on regulatory action. Another reason for Amazon's bullishness may simply be its move past the $600 mark. Shares last hit resistance at $599.50 on April 4 and $599.17 on March 31.

Wednesday's move marks the last time Amazon has closed above $600 since late January, when it reported fourth quarter earnings and strong Christmas holiday sales numbers.

Amazon shares trade near $602 in Wednesday's after-hours session.