Amazon Stock Enjoys Lift on Record-Breaking Holiday Sales

Call traders have been swarming the equity in recent weeks, too

by Emma Duncan

Published on Dec 26, 2019 at 10:55 AM

Another record-breaking holiday shopping season has, Inc. (NASDAQ:AMZN) moving higher this morning, now up 1.2% at $1,809.90 at last glance. Not only did more customers try Amazon Prime, but they shopped at record levels, buying billions of items and tens of millions of Amazon devices. In response, Amazon stock touched a one-month high of $1,824.70 earlier this morning, and is now pacing for a third straight weekly win.

AMZN has added 21% in 2019, and earlier this month toppled the resistance at its 80-day moving average. Now a leg of support for the shares, this trendline, combined with impressive holiday gains, could have the equity breaking above its $1,850 mark for the first time since late July.

Heading into today, all but one covering analyst sported a "buy" or "strong buy" recommendation. Plus, the stock's average 12-month price target of $2,167.56 comes in 18% above current trading levels.

In the options pits, data from the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows AMZN with a 10-day call/put volume ratio of 1.50. This ranks in the 94th percentile of its annual range, indicating calls have been purchased over puts at a faster-than-usual clip.

For those looking to bet on Amazon's next move, options are looking attractively priced right now. The e-tailer's Schaeffer's Volatility Index (SVI) of 16% sits in the low 3rd percentile of its annual range. This means options traders are pricing in extremely low volatility expectations right now. 

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