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Amazon (AMZN) shares will continue to be in focus after the e-commerce and logistics giant surpassed the $2 trillion mark in market capitalization on Wednesday, becoming the fifth U.S. company to reach the milestone. Amazon joins an exclusive group of other major tech giants, including Alphabet (GOOGL), Apple (AAPL), Microsoft (MSFT) and artificial intelligence (AI) darling Nvidia (NVDA).

Below, we’ll take a closer look at Amazon’s chart and use technical analysis to point out key levels to watch for after the stock hits a new record close.

Breakout from the rectangle pattern

Amazon shares have continued to trend mostly up since a chart formation resembling an inverted head and shoulders pattern formed between June 2022 and October 2023. In addition, the 50-week moving average (MA) crossed above the 200-week MA in late March, forming a bullish golden cross, a pattern that often signals the start of a new uptrend.

In addition, the Relative Strength Index (RSI) is just below the overbought threshold of 70, indicating upward momentum.

Recently, the e-commerce giant’s price broke out to a new all-time high (ATH) above a rectangle pattern, suggesting a continuation of the longer-term uptrend. However, investors should watch for an increase in trading volume in the coming trading sessions to confirm the breakout.

Watch these levels after reaching a record high

Given that the stock has entered blue sky territory and there is no previous chart movement to reference, investors can use the measurement principle to forecast a price target to estimate which direction the stock might move next if it continues its uptrend.

To do this, we calculate the stock’s recent increase in points and add that amount to the breakout point of the rectangle. For example, we add $72 to $188, which gives a price target of $260. This provides a general area on the chart where investors can decide to take profits, especially if other indicators simultaneously show overbought conditions.

It is also worth noting that the $188 breakout level will remain a significant technical area on future retracements as it has likely turned from a key resistance area into a new support area over the past three years.

Amazon shares rose 3.9 percent on Wednesday, closing at $193.61.

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At the time of writing, the author does not own any of the securities mentioned above.