Despite the fact that Amazon.com, Inc. (NASDAQ:AMZN)'s stock has jumped roughly 15% in less than a month, a recent story from Nasdaq's ChartWatch (via Wyatt Investment Research) has investors wondering if things are going to stay this way for the long term. In layman's terms, the article is predicting the stock to take a dive in the short term, but it goes on to say that the decline will not last long.
What does this mean to investors? Simply put, the pullback will offer the perfect opportunity to enter a long position with the company. If you take a closer look at the story by the Wyatt Investment Research ChartWatch team, you will see a chart backing up the following:
1) Amazon shares often times reverse course near the 200 day moving average
2) As shares approach $260, history shows that they are due for a pullback
3) A decline appears likely in the near future with a predicted 50 day moving average around $240
Yes, Chartwatch is expecting a decline of roughly 5% over the next few weeks. That being said, not all is lost for investors. Don’t let a sharp decline scare you off. Instead, this is the perfect opportunity for bullish traders to get in on the action at a fantastic entry price.
There are many reasons to keep a close eye on Amazon (AMZN), including its strong tablet sales (Kindle Fire anyone) as well as the increasing popularity of its Appstore.
The online retail giant announced in a recent press release that mobile app downloads have increased 500% over the previous year. Yes, they are still trailing Apple Inc. (NASDAQ:AAPL) but this growth shows great promise for the future.
Other stats from the press release include:
1) The number of GameCircle enabled games available on Kindle Fire has more than doubled since the launch of Kindle Fire HD.
2) Total downloads of the SDKs for In-App Purchasing and GameCircle have more than doubled since the Kindle Fire HD launch and availability of the Kindle Fire HD development resources.
3) The number of developers with In-App Purchasing incorporated in their apps more than doubled in the third quarter of the year (from the start of the quarter to the close of the same quarter).
4) In October, 23 of the top 25 grossing apps used Amazon’s In-App Purchasing technology.
Even if the Amazon (AMZN) rally comes to an end, it is hard to argue against the fact that the future looks bright.