Peter Smith
After several days of sliding prices, Amazon has suddenly reversed course with impressive strength. The turnaround happened right at a critical support area that technical analysts had been watching closely. This kind of sharp recovery from a well-defined zone often signals that the selling pressure has run its course and buyers are ready to take charge again.
Strong Recovery from Key Support
The rebound came from what traders call the "blue box" area on the Elliott Wave chart, a zone between $237 and $244 where corrective moves typically wrap up before prices head higher again. The decline played out in a textbook three-wave pattern, with the final leg bottoming almost perfectly at the $237.05 level, which lines up with the 1.618 Fibonacci extension.
From there, Amazon rallied hard, confirming that the short-term weakness had ended. The pattern suggests we're now seeing the start of a fresh upward move. The blue box has proven to be a solid demand zone, and the decisive bounce means traders who bought near the bottom can now manage their positions with minimal risk since the stock has moved well above their entry points.
The immediate hurdle sits between $255 and $260, where previous peaks occurred. A clean break above this range would likely open the door to a retest of the $262 area and potentially higher. The broader wave structure continues to favor upside movement as long as prices stay above the key invalidation level at $222.67.
Market Context
Amazon's bounce isn't happening in isolation. Large-cap tech stocks have been recovering as investor nervousness settles down after recent market swings. With bond yields pulling back and the holiday shopping season expected to drive strong fourth-quarter results, traders seem to be positioning themselves early for potential strength in both e-commerce and cloud computing.
The technical rebound from the support zone looks like a healthy pause within an uptrend rather than any kind of reversal. When you combine this pattern with improving market conditions, the bullish case gets even stronger heading into late November.
What's Next
If Amazon holds above $245, there's a good chance we'll see further gains toward the $255–$260 range. The wave structure points to the correction being complete and a new upward sequence taking shape. The sharp bounce from support validates the bullish outlook and suggests buyers are regaining control for the near to medium term.
Peter Smith
