Earnings around the corner for Microsoft (MSFT). Analysts are looking for $3.08 EPS for the quarter. Those expectations come on the heels of last quarter’s $2.95 which beat expectations by 1.7%. The stock is very close to 200-day moving average support heading into the number. It has rocketed higher from the 2023 lows under $220, doubling off the lows before retreating to the $420s.
The Relative Strength Index, or RSI, last flashed an oversold “Buy” signal in early August when the price dipped under $400. Heading into the print Wednesday, RSI is slightly above neutral at 56.49. The range has been contracting, with a series of lower highs and higher lows.
Moving Averages: Bartosiak starts by examining the stock's moving averages, such as the 50-day and 200-day moving averages. He points out the significance of crossovers and divergences between these averages, which can indicate potential trend changes.
Support and Resistance Levels: Bartosiak identifies key support and resistance levels on the chart. These levels act as barriers that the stock price must breach or hold above, providing traders with critical decision points.
Chart Patterns: He discusses chart patterns like head and shoulders, cup and handle, or flags, and their relevance in predicting future price movements. These patterns can offer valuable insights into potential bullish or bearish trends.
Volume Analysis: He emphasizes the importance of volume analysis in confirming price trends. An increase in trading volume during a breakout or breakdown can validate the significance of a price move.
Dave Bartosiak's technical analysis approach adds depth to our understanding Microsoft’s stock chart. By paying attention to moving averages, support and resistance levels, chart patterns, technical indicators, and volume, he equips investors with a comprehensive toolkit for making well-informed decisions in the stock market. Remember, while technical analysis is a valuable tool, it's important to consider other factors like fundamental analysis and market sentiment before making investment choices.
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