Amazon stock climbs with upward price move while weak momentum tempers upside potential

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Amazon surges 4.15% to $250.53 today

Highlights

Amazon posted third-quarter revenue of $201.9 billion, up 12% year over year, with AWS revenue rising 39% to $46 billion.
GAAP earnings per share came in below forecasts and negative free cash flow resulted from $75.9 billion in capital expenditures.
Shares of Amazon closed at $250.53, with short- and medium-term technical indicators showing intraday bearish pressure and expected trading between $238.87 and $259.25.

Cloud profits surge but net ETF outflows signal waning conviction

Amazon reported third-quarter revenues of $201.9 billion, an increase of 12% year-over-year that underscores robust demand across its core businesses. Within its cloud division, AWS revenue jumped 39% to $46 billion and operating profit rose 55% to $17.8 billion, highlighting cloud profitability as a key growth lever. However, GAAP earnings per share fell short of Wall Street forecasts, with negative free cash flow resulting from $75.9 billion in capital expenditures in the quarter. According to Yahoo Finance, ETF funds were net sellers of Amazon stock on October 29, reflecting a shift in short-term institutional sentiment after recent inflows.

Mixed technical signals as price tests upper support levels

On the technical front, AMZN is trading above the MA-20 ($245.73), MA-50 ($248.88), and MA-200 ($243.39) on the H1 timeframe. The Ichimoku Kijun level at $242.36 provides immediate support. Despite the positive price action, technical indicators are mixed: MACD, ADX, CCI, and RSI all signal a sell bias, while Stoch RSI is overbought and Bull/Bear Power shows oversold conditions. The Awesome Oscillator remains neutral, indicating a divergence between underlying momentum and price movement.

Pullback risk rises as volatility band defines consolidation

In the short term, AMZN is likely to consolidate within a volatility band of $238.87 to $259.25. The probabilities favor a pullback, with a 73% chance of downward movement and only a 27% likelihood of further gains. If price breaks above $259.25, renewed upside momentum could emerge, while a decline below $238.87 would indicate further downside pressure.

Viktoras Karapetjanc, Traders Union expert, sees Amazon's strong revenue and cloud division results as clear positives in a challenging market backdrop. Despite mixed technicals and a recent shift in ETF sentiment, he believes the robust top-line growth supports a constructive outlook. Risks from negative cash flow and heavy capital expenditure are noted, but they do not outweigh Amazon's long-term positioning. "If Amazon continues to deliver double-digit revenue growth and cloud profitability, I expect investor confidence to strengthen on any short-term pullbacks."

Earlier, analysts noted that rising capital expenditures and concerns about free cash flow were central to the debate over Amazon's ability to fund its AI and cloud ambitions. With the latest results showing robust AWS growth alongside continued negative free cash flow, traders should be alert to potential price inflections if Amazon either sustains momentum above the $259.25 resistance or fails to hold the $238.87 support zone.

Source of Data: AMZN Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.