Chart of the Day: Here's What Microsoft Needs to Make a Move
The stock could be on its way higher if this happens.
You're reading 0 of 1 free page.
Register to read more or Unlock Pro — 50% Off Ends Soon
Building a nice base in price is the foundation of large stock moves. But a lack of a base is like a house of cards, there is just no support and a lack of buying conviction.
Microsoft MSFT is in need of a nice amount of time to build a base, perhaps a month or so. For existing shareholders that might be frustrating, especially if the stock market is rising. That would be detrimental to Microsoft's relative strength, but we are more concerned about the long-term trend than some short-term gains.
With a series of lower highs and lower lows it is clear MSFT is in a downtrend. However, with some higher lows in place this coming week we could upgrade the stock to neutral at best. The indicators are weak but with Friday's big rally in the stock some of them are threatening to turn bullish.
The MACD (moving average convergence/divergence) is turning upward, while stochastics (pane 4) has already made the turn and is pushing higher. Price action, though, is bearish and remains challenged, but let's see if this can flip from bearish over the next few days and start base-building before the next earnings season comes around.
At the time of publication, TheStreet Pro Portfolio was long MSFT.
