Key takeout
Microsoft Shares (MSFT) hit another all-time high on Thursday, boosted by investors’ enthusiasm about the company’s position in the AI race.
On Tuesday, Wells Fargo raised its stock price target, citing the company’s early AI lead and a strong incumbent position in tough markets. Wedbush analysts also raised their price targets on Wednesday, noting that the tech giant will benefit from a massive adoption wave of cop or Azure monetization as enterprise clients deploy AI tools.
The bullish commentary came after reports surfaced last week that Windows Maker was planning to cut thousands of jobs as it aims to increase AI spending while reducing labor costs.
Microsoft’s stock has been 18% since the start of the year, making it the second best performer on Magnificent 7, after only the parent meta platform (META) on Facebook and Instagram. Microsoft won 1.1% on Thursday, finishing at $497.45.
Below, we categorize the technologies in Microsoft’s charts and point out important levels that are worth paying attention to.
The narrow ascending channel remains intact
After closing past the 50- and 200-day moving average last month, Microsoft’s stock traded higher within the narrow upward channel with low volatility.
This movement coincides with the relative strength index, which is roughly above the indicator’s 70 threshold, showing strong momentum. In another indication that the Bulls continue to control price action, the 50-day MA produced a golden cross pattern earlier this month, past the 200-day MA.
However, recently, the stock formed doji in trading session on Wednesday. This is a candlestick pattern that shows indecisiveness between buyers and sellers.
If Microsoft stocks continue to trend high and identify support levels worthy of attention during pullbacks, project technical analysis into potential upside goals.
Measured moving upward target
Investors can project potential upward targets for stocks using measured mobility techniques, also known as the measurement principles by chart watchers.
When you apply the analysis to a Microsoft chart, it calculates the distance of the ascending channel from low to high and adds that amount to the top trend line of the pattern. This will predict your $565 ($70 + $495) goal.
Key support levels worth noting
The first level of the Watch is around $468. A pullback to this area on the chart could attract purchases near last year’s prominent July swing high.
Finally, if Microsoft’s stock drops significantly, you could see a retracement to the $425 level. Investors can place limit orders at this location near the 200-day MA rising. This is a trendline that connects the rising channel lows and a series of trading activities on the charts dating back to May last year.
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As of the date this article was written, the author does not own the above securities.
