Amazon (NASDAQ:AMZN): Double top?
It seems that the chart is forming a double top figure. Though a 101,9$ top in October 23, 2007 broke the resistance level, it was an accident, and the price of the stock fell the next day below the resistance level. It was a false signal.
Afterwards, the price of the stock dropped reaching a bottom in 76,50$ (November 12, 2007). From this level, the price of the stock climbed, reaching again the resistance level ( 95,94$), but without breaking it.
The price of the stock fell again to the 61,8% Fibonacci ratio of the rise (November 16 – Dicember 11) where it climbed again.
Now, the price of the stock is just in the resistance level. If the resistance level is not broken, the double top figure can be confirmed.
We can expect a lateral movement next days and we will watch out for two levels: resistance level: 96$, Support level: 76,50$. If support level is broken, the double top figure will be confirmed. A closing over the resistance level will cancel this figure.
January 2, 2007: Citigroup raised its recommendation on the Web retailer to “buy” from “hold”… If the price of the stock breaks the resistance level, it can soar (objective: 101$). But if the resistance level can’t be broken (in spite of this recommendation), it will drop 10$ at least…