Question

Follow a public traded stock and analyze the changes in stock price. Write a presentation and an executive memo of your findings. Choose one of the following companies:

1. Amazon
2. Alphabet
3. Microsoft
4. Facebook
5. Apple

In your presentation you should:

1. Describe graphically the trend of the stock prices during the last 2 months and, in more detail, during the last 3 weeks.
2. Explain the observed trends
3. Compare the trends with relevant indexes
4. Relate these trends to relevant contextual information (example: Covid crisis).
5. Is the development of the prices positive? Do you consider that an investment done two months ago is good? Explain.
6. Regarding this context, briefly forecast the changes in prices for the next month.

Answer 1

1.

TREND

LAST TWO MONTHS

there is constant trend in amazon since last 2 months as price is at same place where it was 2 months ago

TREND

3 WEEEKS

From last 3 weeks there is a clear downtrend and stock has wiped out its gains of last 2 months in this fall

OBSERVATION OF TRENDS -

STOCK OF AMAZON has started as a bullish trend from the previous rally and continued to become the new highs 3549 but since then it formed a hanging man from the top and never recovered from there , then and there the downfall started and till now it is in downtrend wifing out gains of last 2 months.

COMPARING AMAZON WITH DOW JONES

The blue line chart shows price action of amazon and purple line chart shows price action of dow jones

the comprison of amazon with dow jones is bearish Dow jones is above the point where it was 2 months ago both have made their respective on the same day and started to fall in which amazon reached the place where it was 2 months ago but dow jones has managed to be higher than it was 2 months ago

During the Covid crisis like all other stocks amazon fell but managed to overcome this due to boom in retail industry and shutdown of supermarkets due to steps taken by the government . people had limited choices of buying necessities only through retail platforms therefore covid act as ana opportunity for AMAZON

Comparing price with 2 months ago -

comparing price with 2 months ago price does not show any improvement and is at the same point where it was 2 months ago therefore ideally one should wait for the price to come down further as it wants and then buy it where the retracement takes.

Forecast for next 2 months -

AMAZON is near a very important support which can make or break it. it has taken multiple supports from this point . if it breakes it more downside is coming but if the supports works amazon will move again on uptrend to makes new highs so my strategy favouring risk reward is

BUY AT 2930

STOP LOSS - 2888 ON CLOSING BASIS

TARGET - 3550