Amazon.com, Inc. ( AMZN ) - I last recommended AMZN stock as the Trade of the Day on April 4 with a buy under price of $575 and a target of $680. The following day, shares hit a low of $585.25 and then took off, exceeding my target by early May and running above $700 for the first time in the stock's history on Tuesday.
Buy under prices are suggestions, so hopefully some of our readers got in near the lows. But with Tuesday's breakaway gap propelling AMZN stock to a new all-time high, the advance is likely to continue.
Shares hit an intraday high of $704.55, exceeding the previous high of $696.44, made on Dec. 29, before closing the day up 3.4% at $703.07. The gains came as Amazon launched its new video service, called Amazon Video Direct, which is meant to compete with Alphabet Inc's ( GOOG , GOOGL ) YouTube business.
Additionally, on Tuesday, analysts at Bernstein said AMZN stock was undervalued and raised their 12-month price target from $770 to $1,000, which is more than 40% above recent prices. According to FactSet, the median price target of 42 analysts is $807.67.
On the chart, we see AMZN stock triggered a golden cross in mid-April. This is a long-term buy signal in which the 50-day moving average crosses up through the 200-day. The golden cross was followed by an impressive continuation gap from $627 to $654 on April 28, after the company blew past analysts' first-quarter earnings estimates and reported a 28% jump in revenue. MACD is positive and momentum is strong.
With Tuesday's new breakaway gap, the next upside target is $725, which is 3% above the market price. This should be achieved in short order, and a target of $900, 28% higher than the current price, may be within reach in the next year.
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