Amazon’s stock has been in a steady uptrend since the beginning of the year, attempting to erase part of its 2022 decline. In the short term, the stock experienced a pullback after posting a fresh 2023 peak of 136.30, but quickly found its footing around the 50-day simple moving average (SMA).

The momentum indicators are currently reflecting a divergence. On the one hand, stochastics are ascending near the overbought territory, whereas the MACD has retreated below its red signal line in the positive zone.

Should the stock extend its recent rebound, the 2023 high of 136.30 might prove to be the first barrier for the bulls to clear. Surpassing that zone, the price might face the August 2022 high of 146.00 ahead of the April 2022 resistance of 158.50. A break above the latter could trigger a rally towards the March 2022 peak of 170.00.

Alternatively, if earnings paint a gloomy fundamental outlook, the price could retreat to 126.00, which held its ground twice in the past month. Pushing the stock below this zone, the bears may then aim at the previous resistance of 113.50. Failing to halt there, the price could inch lower to challenge the 100.00 psychological mark, which also acted as support in June 2022.

Overall, Amazon’s stock has partially erased its latest correction ahead of the upcoming earnings announcement on Thursday. Thus, traders should be cautious as we could experience heightened volatility in the days to come.