Amazon.com, Inc AMZN was popping up over 1% higher in the premarket on Wednesday, regaining the psychologically important $100 level after headline consumer price index data came in lower than expected.
The move came in tandem with the general market, which saw S&P 500 futures reacting positively to indications that inflation continues to tick lower.
CPI data for March came in at 5% year-over-year, which was a greater-than-expected drop, with economists estimating the reading would come in at 5.2%.
The news caused Amazon, which saw heavy downward pressure on Tuesday, to spike higher. If the upward momentum continues, the stock could avoid negating an uptrend Amazon in which started trading March 13.
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The Amazon Chart: Amazon’s most recent higher high within its uptrend was printed on April 4 at $104.20 and the most recent confirmed higher low was formed at the $96.29 mark on March 28. On Tuesday, Amazon printed a hammer candlestick, which suggested the next local bottom could be in and the stock will trade higher on Wednesday.
- On Tuesday, Amazon rejected the eight-day exponential moving average (EMA) but held support at the 21-day EMA. Bulls want to see Amazon regain the eight-day EMA on Wednesday to avoid causing the indicator to cross under the 21-day.
- If Amazon continues in its uptrend and rises over the $105 mark over the next few days, the stock may bump into the 200-day simple moving average. If that occurs, the area is likely to act as resistance for at least a short period of time.
- Amazon has resistance above at $109.30 and $117.16 and support below at $99.88 and $95.49.
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