Is Amazon’s Price Predicting A Pop On Earnings?

Amazon.com, Inc. (AMZN) will hold a conference call to discuss its fourth quarter 2022 financial results after the market close on Thursday, February 2, 2023. Wall Street expects the online retailer to earn $0.17 for the quarter with sales of $145.34 billion.

AMZN is subject to some major price swings following its quarterly financial checkup. In the last quarter, they closed at $110.96 and opened the following day at $97.91; in between, third quarter numbers were announced.  Shares popped higher on the second quarter report but tanked after the first quarter report.

Interestingly, shares were headed in the direction of earnings prior to the earnings announcements. In April, AMZN’s stock price was sliding and slid some more post quarterly results. In late July, shares were on the rebound and bounded higher after earnings were announced. Amazon shares were headed south prior to the $13 per share dump last quarter.

This time around, Amazon’s shares are in a bullish stance after defeating a downtrend. As we type, AMZN shares are trading at $96.98 after testing its 50-day moving average of $91.20 before rebounding Wednesday afternoon.

If Amazon’s earnings and guidance are underwhelming, the 50-day benchmark should offer some price support with a secondary level at $85. It’s bombs away if the stock closes below the 52-week low of $81.43.

If the trend continues where earnings follow the pre-earnings price trend and AMZN shares pop, they could offer upside to as high as the 200-day moving average of $113.44.

Trading stocks ahead of earnings is about as risky as it gets and is only appropriate for investors who can lose money in short timeframes.

Rich Meyers
Investing Trends