Hello friends, and welcome back to AppleTree360, where we dive deep into the charts to make sense of market moves before they unfold. Today, we’re taking a close look at Amazon (AMZN) on the 4-hour chart — with a particular focus on extended trading hours to understand what the big players might be doing behind the scenes.
Watch the full breakdown on our YouTube Channel
Why the 4-Hour Extended Session Matters
We use the 4-hour extended trading chart (covering both pre-market and after-hours activity) to catch subtle shifts in price action. These sessions often offer early clues about institutional behavior — giving us a sneak peek before the market makes its big moves.
Back on April 22, we saw a clear volume spike during a dip — a typical footprint of buyers stepping in quietly. That volume surge marked a short-term bottom and led to an upward move. Then came a period of consolidation, another base-building zone, followed again by a spike in bullish volume. Each of these patterns told a story — and they’re telling one now, too.
This Week’s Setup: Boxes, Breakdowns, and Bearish Momentum
Fast forward to Thursday and Friday of this past week, we’ve observed Amazon forming tight compression zones (box setups). These boxes are powerful — they signal whether price is winding up to break higher or lower. In this case, we saw a clear breakdown, followed by strong selling pressure.
It wasn’t just a fade. It was hard, institutional-level selling based on the volume spikes noticed.
What’s more? Another short-term compression box has formed — and it also appears biased to the downside.
Daily Chart Signals: Gap Fill Ahead?
Now, shifting to the daily chart, Amazon gapped up in early May — a nearly 8% surge from May 9 to May 12. That gap is now at risk of being filled if downside momentum continues.
With Friday’s Moody’s downgrade of the U.S. credit rating shaking overall market confidence, this could add to the bearish pressure across major tech names — Amazon included.
If momentum stays bearish, we may revisit the $195 level — a key zone to watch.
Buying the Dip? Why $195 Might Be a Long-Term Opportunity
While the short-term trend is clearly not favorable for bulls, a dip to the $195 area could be an excellent opportunity for long-term investors.
Here’s why:
- That would represent a 20% pullback from recent highs
- For example, You’d be buying $100 worth of stock for $80
- Amazon remains a long-term growth name — and this pullback might just be a healthy reset
Final Thoughts: Patience Pays in Uncertain Times
Short-term traders: This is not the time to chase upside. The risk-reward doesn’t justify it. And unless you’re confident in catching a quick 4–5% move, it may not be worth the stress.
Long-term investors: Keep your eyes on that $195 zone. If Amazon pulls back that far, you might just find a high-quality stock at a meaningful discount.
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Happy trading, and have a great week ahead!
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