Amazon Share Price: A new All-Time High But It's Tough At The Top

Summary:

Following bumper earnings, the Amazon share price was once again back above $3,500, setting a new record of $3,552.84 before reversing to $3,467

Following bumper earnings, the Amazon share price was once again back above $3,500, setting a new record of $3,552.84 before reversing to $3,467.

The market expects big things from Amazon earnings, and the e-commerce giant has a habit of delivering (excuse the pun). Thursday’s numbers beat on every metric, with sales up a whopping 44% year over year.

Earnings: $15.79 vs. $9.54 expected
Revenue: $108.52 Billion vs. $104.47 Billion expected

Not satisfied with blowing the first quarter away, Amazon also predicted a continuation of favorable conditions in Q2, projecting between $110 Billion to $116 Billion in revenue for the upcoming period. This positive forward guidance is likely to see the Amazon share price continue to trend higher for some time to come.

Outside of its core e-commerce offering, sales at Amazon’s cloud-computing division increased by 32% over the last 12 months.

With many countries still experiencing lockdown restrictions, It came as no surprise that Amazon Prime video also fared well. CEO Jeff Bezos discussing the success of the streaming platform on the earnings call, said:

“over 175 million Prime members have streamed shows and movies in the past year, and streaming hours are up more than 70% year over year,”

It’s a fair assessment to say that the company has positioned itself perfectly over the last 15 months, and the Amazon share price reflects that. Consumer trends have changed dramatically during the Global pandemic, and it’s quite possible that even as the world fully reopens, retail will look very different from how it did in 2019.

Whatever the future holds, you can be sure that Amazon will continue to play a big part in how the world shops, eats, watches T.V and manages its data.

Amazon Price Outlook

Friday’s rally saw the Amazon share price exceed the previous $3,552.25 ATH by just $0.59 before snapping back.

The price rejection looks purely technical, and I expect to see a new high sometime soon. However, there is a danger that should the market fail to break new ground on the upside; a double-top may form.

In this instance, the Amazon share price may offer a cheaper entry point. The stock can find support at $3,433, the 3rd of February and 19th of April highs. The next level on the downside would be the $3,301.45 low of April the 24th.

Buying is likely to materialize on any pullback in price. Buying is also likely on fresh momentum through Friday’s high. In summary, buying is likely to be seen.

A failure to hold $3,300 per share would invalidate the immediate bullish call.