Stock of the day: Microsoft
08 August 2024
Microsoft had a challenging July. The price started at long-term highs but ended significantly lower, wiping out the gains from June and, in the subsequent days, even those from May. In just over a month, the gains from the previous two months were erased. Technically, the outlook is concerning as the price broke below the green uptrend line, marking the first warning sign.
Currently, the price is bouncing off the yellow horizontal support around $385. As long as it stays above this level, buyers still have a chance. However, if the price closes a day below this yellow support, it will be a clear sell signal. On the flip side, if the price forms a reversal pattern at this yellow support, it could present an opportunity to buy into a long-term uptrend on Microsoft's chart.
In summary, while the recent performance has been negative, the critical support level at $385 is pivotal. The market's next moves around this level will determine whether we see a continuation of the downtrend or a potential reversal and buying opportunity.