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Amazon chart produces ‘death cross’ pattern despite rising short- and long-term trend trackers

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Amazon.com Inc.’s
AMZN,
-0.78%

stock chart has produced a “death cross” pattern, the first in 18 months, but it has done so even both the shorter-term and longer-term trend trackers were rising. A “death cross,” in which the 50-day moving average crosses (50-DMA) below the 200-day moving average (200-DMA), is typically seen as a bearish technical pattern, with many chart watchers seeing them as marking the spot a shorter-term selloff transitions to a longer-term downtrend. They aren’t always good market-timing patterns, as they are well telegraphed, but they can help provide perspective on a recent move. On Monday, Amazon’s stock fell 0.7% in afternoon trading, while the 50-DMA rose to $3,180.95 from $3,180.03 and the 200-DMA rose to $3,181.95 from $3,179.46. This would mark the 13th “death cross” since Amazon’s stock went public in May 1997, but would be the only one to appear when both the 50-DMA and 200-DMA were rising. The 50-DMA may be rising recently, but it is currently around the same level as it was in mid-September 2020, while the 200-DMA is roughly 33% above where it was at the same time. Amazon’s 50-DMA has been above the 200-DMA since Feb. 5, 2020, as the ecommerce giant was seen as a beneficiary of COVID-19-related restrictions, and the last “death cross” appeared on Oct. 10, 2019. The stock has edged up 3.7% year to date, while the S&P 500
SPX,
-0.58%

has gained 10.8%.