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Amazon’s stock, which has been climbing steadily, might soon face some challenges. The European Union is gearing up to introduce stricter digital regulations that could impact the stock’s bullish outlook. EU regulators are set to enforce new rules under the Digital Markets Act, aimed at curbing the market power of major tech companies like Amazon, Meta Platforms (formerly Facebook), Alphabet, and Microsoft.
These new regulations are designed to prevent these companies from having too much control in the market. They require that users be able to delete pre-installed apps on their devices, give enterprise users access to their data, and stop promoting their own products over competitors’.
If Amazon and other big tech companies don’t comply, the European Commission can impose hefty fines, up to 10% of global turnover, with the potential for fines to double for repeat offenses. The European Parliament still needs to approve the Digital Markets Act, and its implementation could affect Amazon’s stock price forecasts.
Recently, Amazon’s stock broke through a key resistance level at 3084.19 (the highs from October 2021 and January 2022), pushing towards a target of 3540.65. However, it first needs to overcome an immediate resistance at 3347.32. If it surpasses this barrier, the next resistance level is 3435.00 (from late 2021).
If the stock fails to break through 3347.32, it might pull back, targeting 3300.43 (the lows from late 2021), and potentially drop further to 3173.69, 3084.19, or even 2992.92 if the decline continues.