Shares of Microsoft have been retreating after failing to take out the July all-time high at $555.45 at the end of October. At that time, the rally stalled again just shy of that mark at $553.72, and the inability to print a new high proved to be an early technical warning. The rejection at the top was followed by a slide below both the 50-day moving average (black line) and the 100-day moving average (blue line) in early November, shifting the near-term bias to the downside (see the chart below).
The corrective low from that decline bottomed on November 7 near $492.37, aligning closely with the September swing low. A rebound followed, but it fizzled out right at the confluence of the 50-day and 100-day MAs, and the pair rotated back lower beginning on November 13.
Selling pressure intensified late last week, with Friday’s low reaching $468.27, and today’s low dipping slightly to $468.02. Importantly, both levels held just above the rising 200-day moving average at $466.89, allowing buyers to halt the decline.
Microsoft is currently trading up 0.36% at $473.81, leaving traders to assess whether a -15.43% pullback from the late-October high and a successful test of the 200-day MA is enough to mark a near-term bottom. Technically, as long as the price holds above $466.89, buyers retain a foothold and can continue to lean against the 200-day for risk.
On the topside, recapturing the old floor at $492.37 (red circles on your chart) would bolster buyer confidence and open the door for a push toward the now-converged 50-day and 100-day MAs near $512. Conversely, a break below the 200-day MA would weaken the bullish structure and expose the next major downside target at $450.12, the 50% retracement of the advance from the April 2025 low.
This article was written by Greg Michalowski at investinglive.com.