NEW DELHI (CoinChapter.com) — Amazon (NASDAQ:AMZN) stocks had a disappointing 2022, with the firm joining the list of the worst-performing tech stocks of the year. The downtrend likely resulted from Amazon layoffs news and the overall global stock downtrend.

On Wednesday, Amazon CEO Andy Jassy announced it would layoff more than 18,000 jobs from its workforce in 2023. The retail giant cited the economic uncertainty and the fact that Amazon was on a hiring spree during the pandemic.

The Amazon CEO stated the company’s leadership did not take this decision lightly as they were conscious of how difficult the layoffs would be for the employees.

We are working to support those who are affected and are providing packages that include a separation payment, transitional health insurance benefits, and external job placement support.

Andy Jassy said in his statment

Amazon stated that while they usually announce such news after speaking with the impacted people, this time, they were forced to announce it since “one of our teammates leaked this information externally.”

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Jassy shared that some layoffs would be in Europe, adding that Amazon would inform the European employees starting Jan 18.

Why AMZN Stock Price Is Down?

The Amazon CEO noted that “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” likely referencing the company’s performance in 2022.

At one time, markets viewed Amazon as an invincible e-commerce giant, with the company’s earnings report often delighting investors. However, Amazon started looking vulnerable when it fell short of Wall Street forecasts in Apr 2022.

The retail giant reported a first-quarter loss of $3.8 billion. AMZN stock price plunged 14% reacting to the news, the company’s largest single-day loss since Jul 2006. The drop made some analysts suggest that Amazon needed to rethink its strategy.

However, earnings reports were not the only reason why Amazon share price was down in 2022.

Leaked reports of a possible layoff of nearly 10,000 employees in late Nov 2022 likely led to stock prices tumbling. With Amazon layoffs 2023 officially announced, market confidence in the e-commerce giant’s shares might dwindle.

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As such, Amazon shares might not be a buy at the time. The layoffs in 2023 might dampen investor spirits, leading to fewer buyers available to prop up an uptrend for the tech giant.

Amazon Stock Price Prediction

Amazon share price ended 2022 as its worst year since 2000, the year of the dot-com crash. AMZN price started the year with marginal gains of 2.17% on Jan 3. However, shares of the e-com company plummeted nearly 4.2% on Jan 4 to form a low near $83.36 before the bulls regained some losses.

The Amazon stock price was rebuffed by a dynamic resistance confluence of the 20-day EMA (red wave) and multi-week descending trendline resistance near $88. For AMZN to establish a strong uptrend, bulls need to push the Amazon share price above the immediate resistance.

Furthermore, a break and hold above immediate resistance might help AMZN price challenge its 50-day EMA (purple wave) resistance near $94 before downside corrections pare gains.

Amazon Stock price chart with RSI. Amazon shares need to break above immediate resistance to establish an uptrend successfully.

On the other hand, failure to move above the descending trendline might push AMZN price to test support near $80.7. Moreover, a breach below immediate resistance could result in Amazon stock price dropping to support near $75, a level AMZN last reached in Jan 2019.

The relative strength index for AMZN remains neutral, clocking 42.14 on the daily charts, while the RSI trendline is crabbing.

The post Amazon News: Amazon (NASDAQ:AMZN) Layoffs For 2023 Likely Behind Why Stock Is Down appeared first on CoinChapter.

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Filed under: Bitcoin - @ January 5, 2023 9:22 am