Falling Wedge in Microsoft

2023년 8월 14일

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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