AMZN TECHNICAL PICTURE IS BULLISH SHORT-TERM AND BEARISH OVERALL

Amazon, Inc. has rebounded after testing the projected support at $320.66 and may have more of a rally left before the counter-trend rally runs its course. With upside projected at $362.93, is it worth buying? Recap of our last report on Amazon, Inc.

• Amazon had rebounded modestly following the post-earnings blow up that occurred in late-July. • Analysts and investors had grown weary of seeing the company defer making profits on its strong income and cash flow. • The bulls liked AMZN's cheap price-to-sales ratio, huge cash position and positive cash flows. • The bears were focused on AMZN's high valuation metrics (P/B of 14.77, P/E of 150), poor performance following the latest earnings report and the stock's poor relative strength. Technical update for AMZN shares… Amazon shares have rebounded nicely off of the $320 level. If the current upside is the “c” leg of an “abc” upside correction, then the projected technical target will come in at $362.93. Short-term, the support for AMZN comes in at $319 – with $304.59 as secondary support. Overall… Bulls will be looking to buy Amazon on any pullback to near $319 - $320 with stops in place on any close below $319. Bears may be in for some pain short-term if they continue betting against Amazon shares at current levels (near $325). However, they may still have the advantage over the bulls in the intermediate-term.