Watch these Amazon price levels as the stock hits a new record high

Shares of Amazon (AMZN) hit another record high on Thursday, defying the broader market’s downturn today and increasing their year-to-date gain to 45%.

On Tuesday, the tech giant announced that it is building a supercomputer using its in-house Trainium chips to be used by artificial intelligence (AI) startup Anthropic. According to a report in The Wall Street JournalThis puts the company in a position to take over AI favorite Nvidia (NVDA) in the lucrative graphics processor (GPU) chip market.

Separately, the e-commerce titan this week reported record sales and a record number of items sold as the holiday shopping season begins, with the company saying the majority of sales came from independent sellers.

Amazon’s gains so far in 2024 significantly exceeded the S&P 500’s return of around 27% over that period. The stock rose 1.1% to $220.55 on Thursday.

Below we analyze the technical data on the Amazon chart and point out key price levels that investors may be paying attention to.

Ascending Triangle Retest

After breaking out of an ascending triangle last month, Amazon stock retested the initial breakout area before moving higher, signaling a continuation of the stock’s longer-term uptrend.

Meanwhile, the Relative Strength Index (RSI) confirms a bullish price move with a reading above 60, although the indicator is still below the overbought level, giving the stock room for further upside before consolidation occurs.

Let’s look at Amazon’s chart to predict a potential price target and identify three key support levels that could generate buying interest if the stock declines.

Upside price target to keep an eye on

Investors can predict an upside target using the measurement principle, a technique that analyzes past price movements to predict future movements.

To apply the tool to Amazon’s chart, we measure the distance between the ascending triangle’s two trendlines near their widest point and add this amount to the pattern’s breakout area. Therefore, we add $50 to $200, predicting a target of $250, a chart location where investors might decide to lock in profits.

Monitor these important support levels

The first lower level to monitor is around $200. A second retest of this area would likely reveal buying interest near the upper trendline of the ascending triangle, which could turn into a price floor.

A decisive close below this key level could see shares slip to around $190, an area where they could find support near a trend line connecting several peaks formed on the chart between April and October .

Finally, a stronger downward move could trigger a decline to the $175 level. Investors could look to build buy-and-hold positions in this area near a multi-month horizontal line connecting a series of comparable trading levels on the February-September chart.

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At the time of writing, the author does not own any of the securities mentioned above.