Chart of the Day: Can Microsoft Save the Magnificent Seven?
Software-related names have been pushing forward and making a strong run since bottoming a few months back. Leading the charge has been Microsoft ($MSFT), far and away the best-performing Magnificent Seven stock over the last three months.
Since its prior earnings Mister Softee is up a whopping 31%, a stunning amount for a mega-cap name. But recent moves lower seem to indicate the stock has run a bit too far and may be due for a corrective phase. Certainly the recent follow-on action from names such as Meta ($META) and Tesla ($TSLA) are not inspiring any investors/traders to take a bold position in Microsoft or any large tech for that matter.
However, as always, the company has a tendency to surprise to the upside like it did last quarter. The technical picture is mixed, with teal colored candles, indicating cautiously bullish on the GoNoGo composite of indicators. The parabolic SAR (stop and reverse) has turned bearish, MACD also turned down last week, while money flow is bearish.
Perhaps news will flip things around, but sitting near the lower Bollinger band (top chart) tells us the selling is probably close to finished. Microsoft will report earnings after the close on Wednesday, October 28.
We like Microsoft in TheStreet Pro Portfolio and rate it a Two, or “stockpile on pullbacks” (like, right now!).
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At the time of publication, TheStreet Pro Portfolio was long MSFT and META.
