Amazon Stock: The Correction May Be Over

Amazon is showing signs that its recent correction may be coming to an end. After several weeks of weakness, the stock has started showing stronger buying momentum and an important reversal signal.

Amazon Shows a Reversal

Around September 18, Amazon traded above its 50-day average volume, with roughly 52 million shares traded versus an average near 40 million.

That was the first clue that buyers were stepping back in.

The following days were also interesting. Selling appeared, but the selling volume was lower than the buying volume.

Then Amazon produced a strong reversal candle on above-average volume.

Instead of continuing lower, the stock moved higher on the following sessions.

This is the type of price action I look for:

Correction → reversal candle → confirmation → accumulation.

Rather than chasing the stock after a big move, the goal is to identify the reversal and build a position during the correction.

Amazon’s Bigger Picture Looks Interesting

The three-month chart also provides an important signal.

Amazon moved above its previous major high around the $250 area, suggesting that the larger trend may be shifting higher.

Historically, when a strong business breaks above a major high and later goes through normal corrections, those corrections can provide opportunities to accumulate rather than exit the long-term trend.

The same approach worked during Amazon’s previous major cycle, when the stock moved from around $115 toward $220 over roughly a year and a half.

Levels I’m Watching

If the current momentum continues, the first important level is around:

$280–$290

Above that, the next major target is around:

$315

If the longer-term momentum remains strong, Amazon could potentially reach:

$360+

These are chart-based levels, not guarantees.

The key is not to chase the stock after several consecutive green days. A pullback toward the $254–$256 area could provide another opportunity to accumulate if the overall trend remains intact.

The Bigger Strategy

The approach is simple:

Look at the bigger trend. Wait for a correction. Identify the reversal. Accumulate. Then give the investment time to work.

This can be much less demanding than constantly trading in and out of a position.

For strong businesses, a few minutes of chart review each day or a weekend review may be enough to identify these opportunities.

Amazon’s recent action suggests that a new upside cycle could be developing. Now the focus is on whether the stock can maintain its momentum and eventually reach the higher targets.

Don’t chase the move. Watch the correction.

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Disclaimer

This article represents technical market analysis and is for educational and informational purposes only. Price targets are estimates based on chart analysis and should not be considered guarantees or personalized investment advice.