Amazon (NASDAQ:AMZN) continues to hammer on a chart trend line that has kept it in check for the last few months. Anytime Amazon has hit this trend line, it has pulled back. The trend line is up-sloping which is significant for the following reason. These trend line rarely break to the upside and the more they hammer on the trend line but fail to break, the more likely a bigger correction takes place. This is a proven technical factor on charts throughout history, especially ones at all-time highs. Based on Amazon hammering against this trend line now six times, it is likely the next pull back will be large, potentially taking the stock from its current level of $670 to as low as $600.

Jenny Rebekka