SEATTLE — After a tumultuous start to February 2026 that saw Amazon.com, Inc. (NASDAQ: AMZN) endure a record-tying nine-day losing streak, market technicals and top-tier analyst calls suggest the e-commerce and cloud giant has finally found a floor. Following a massive $200 billion capital expenditure announcement that initially spooked investors, a sharp reversal began this week as technical indicators reached their most "oversold" levels in nearly four years.

The rebound is being spearheaded by a defiant "Overweight" reiteration from Morgan Stanley (NYSE: MS), which argued on February 18 that the market is severely underestimating the "GenAI yield" inherent in Amazon’s aggressive infrastructure spending. As the stock stabilized near the $204 mark after testing a critical $196 support level, institutional buyers appear to be moving back into the name, betting that the short-term margin pressure from record spending will pave the way for a generational leap in generative AI (GenAI) capabilities within its AWS and Retail divisions.

Technical Exhaustion Meets Fundamental Conviction

The precipitous drop in Amazon’s share price earlier this month was triggered by the company's "Big Shocker" disclosure of a $200 billion capex plan for 2026—a figure that represents the largest single-year corporate investment in history. While the initial reaction focused on the pressure this would place on free cash flow, technical analysts began flagging extreme exhaustion in the selling pressure by mid-February. The 14-day Relative Strength Index (RSI) for AMZN plummeted to between 15.4 and 26.7, levels not seen since the tech rout of 2022. Historically, an RSI below 30 indicates a stock is oversold; at sub-20 levels, it suggests a "coiled spring" effect where selling has reached a point of irrationality.

Compounding the bullish technical case is a narrowing histogram on the Moving Average Convergence Divergence (MACD). While the signal remains in negative territory, the decreasing momentum of the downward bars suggests a "bullish divergence"—a scenario where the price hits new lows but the momentum starts to turn upward. By February 19, the stock had bounced nearly 5% off its monthly lows, signaling that the "weak hands" may have finally exited the position.

The move was further solidified by Morgan Stanley analyst Brian Nowak, who maintained a $300 price target for the stock. Nowak’s thesis rests on the idea that Amazon is currently "capacity constrained" in its cloud division, Amazon Web Services (AWS). Rather than viewing the $200 billion spend as a risk, Morgan Stanley characterizes it as a necessary—and highly profitable—expansion to meet a surging $244 billion AWS backlog. The firm projects that as this new capacity goes online, AWS revenue growth could re-accelerate to over 30% by late 2026, far outpacing the current market consensus.

The AI Arms Race: Winners, Losers, and the 'Capex War'

Amazon's aggressive spending has forced a re-evaluation of the entire Big Tech landscape. While Amazon (NASDAQ: AMZN) is the primary subject of this recovery story, its peers are feeling the heat of the "Capex War." Alphabet Inc. (NASDAQ: GOOGL) has responded by ramping its own spending toward $185 billion to protect its search-to-buy ecosystem, while Microsoft Corp. (NASDAQ: MSFT) remains a formidable but increasingly constrained rival as it balances its multi-billion dollar commitments to OpenAI.

The "losers" in this current environment appear to be mid-tier retailers and cloud providers who lack the "clean data foundations" or the deep pockets required to build custom AI hardware. However, a surprising challenger has emerged in Walmart Inc. (NYSE: WMT). While Amazon builds its "Walled Garden" around its AI shopping assistant, Rufus, Walmart has led an "Anti-Amazon Alliance" by adopting open-source commerce protocols. This strategy has allowed Walmart to hit a $1 trillion market cap this month, as its AI assistant "Sparky" drives higher average order values among high-income digital shoppers.

For hardware suppliers, the news is almost universally positive. Companies like NVIDIA Corp. (NASDAQ: NVDA) and Marvell Technology, Inc. (NASDAQ: MRVL)—the latter of which is a key partner in manufacturing Amazon’s proprietary Trainium3 AI chips—stand to benefit directly from Amazon’s $200 billion infrastructure binge. As Amazon pivots from buying off-the-shelf chips to designing its own "silicon-to-software" stack, the long-term margin profile of AWS could improve significantly compared to peers who remain dependent on external vendors.

From Search to Agents: The Shift to 'Agentic Commerce'

The broader significance of Amazon's recent bottoming lies in the industry-wide transition from "Experimental AI" to "Agentic Commerce." In early 2026, the market has moved beyond simple chatbots toward AI agents that can autonomously discover, negotiate, and purchase products. Amazon’s Rufus is a prime example, now serving over 300 million users and reportedly contributing an estimated 140 basis points to the company’s Gross Merchandise Value (GMV) growth.

This shift mirrors the historical transition from physical storefronts to digital search, but with even higher stakes. Morgan Stanley’s research highlights that Amazon is "uniquely positioned" because it owns both the AI brain (AWS/Bedrock) and the physical muscles (its massive logistics and last-mile delivery network). By integrating Rufus into every step of the shopping journey, Amazon aims to make shopping "frictionless" in a way that purely software-based AI models cannot match.

Furthermore, the emergence of "horizontal" partnerships—where third-party AI agents like ChatGPT or Google Gemini use Amazon’s APIs to fulfill orders—suggests that Amazon's "last-mile" dominance may be its ultimate moat. Even if consumers use a competitor’s AI to choose a product, the actual transaction and delivery are increasingly likely to run through Amazon’s infrastructure, effectively turning the company into the "operating system" of global commerce.

Looking Ahead: The Road to $300

In the short term, investors will be watching for a definitive MACD "bullish crossover" and a sustained move above the 50-day moving average. The primary challenge for Amazon in the coming months will be executing its massive infrastructure build-out without further startling the bond market or depressing quarterly earnings-per-share (EPS). Strategic pivots may be required if the "Agentic Commerce" trend moves faster than expected, potentially forcing Amazon to open up its "Walled Garden" to more third-party AI agents to maintain its market share.

Longer-term, the focus remains on the "GenAI yield." If Morgan Stanley’s projections hold true and AWS growth re-accelerates toward 30%, the current valuation of roughly 19x projected 2027 GAAP EPS will look like a historic bargain. Market participants will also be keeping a close eye on the performance of the "Project Leo" satellite network, which represents a significant portion of the current capex but offers the potential to connect billions of new customers to the Amazon ecosystem in underserved regions.

Market Outlook and Final Thoughts

The recent technical bottoming of Amazon (NASDAQ: AMZN) suggests that the "Capex Shock" of early February has been fully digested by the market. The confluence of extremely oversold RSI levels and a narrowing MACD histogram indicates that the bearish momentum has reached a point of exhaustion, while the fundamental backing from Morgan Stanley provides the necessary catalyst for a sustained recovery.

As we move further into 2026, the key takeaway for investors is the distinction between "spending" and "investing." Amazon’s record-breaking $200 billion outlay is a high-stakes gamble on the future of AI-driven commerce and cloud infrastructure. While this level of spending creates volatility, the underlying growth in the AWS backlog and the early success of Rufus suggest that Amazon is not just participating in the AI revolution, but actively building the rails on which it will run. Investors should watch for AWS growth metrics in the Q1 2026 earnings report and any signs of Rufus integration into broader third-party AI ecosystems as the next major catalysts for the stock.

This content is intended for informational purposes only and is not financial advice. All stock performance and analyst projections are based on reported data as of February 19, 2026.