Falling Wedge in Microsoft
Technology stocks have retreated this month as the AI frenzy cools. Microsoft, in particular, has pulled back.
The first pattern on today’s chart is the narrowing range since the slide began in late July. MSFT has made lower highs, but lower lows at a shallower pace. That could have produced a descending triangle, which is potentially bullish.
Second, consider the rally between April 25, when results beat estimates, and July 18, when the company announced pricing for its AI services. The current pullback represents about a 50 percent retracement of that move.
Third, the software giant has remained above its 100-day simple moving average (SMA) since January. But now prices are returning to the vicinity of this longer-term trend indicator.
Finally, stochastics have been in oversold territory for more than a week.
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The first pattern on today’s chart is the narrowing range since the slide began in late July. MSFT has made lower highs, but lower lows at a shallower pace. That could have produced a descending triangle, which is potentially bullish.
Second, consider the rally between April 25, when results beat estimates, and July 18, when the company announced pricing for its AI services. The current pullback represents about a 50 percent retracement of that move.
Third, the software giant has remained above its 100-day simple moving average (SMA) since January. But now prices are returning to the vicinity of this longer-term trend indicator.
Finally, stochastics have been in oversold territory for more than a week.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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