MSFT closes above its opening price after recovering from early selling pressure


Microsoft Corporation (MSFT) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team

Highlights

MSFT closes above its opening price after recovering from early selling pressure
MSFT closes within previous day's range after lackluster session

Overview

MSFT ended the week 0.19% higher at 183.51 after edging higher $0.08 (0.04%) today on low volume, slightly underperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. Trading up to $0.65 lower after the open, Microsoft managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.

Daily Candlestick Chart (MSFT as at May 22, 2020):

Daily technical analysis candlestick chart for Microsoft Corporation (MSFT) as at May 22, 2020

Friday's trading range has been $1.92 (1.05%), that's far below the last trading month's daily average range of $4.21. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MSFT.

One bullish candlestick pattern matches today's price action, the Bullish Spinning Top. The last time a Bullish Spinning Top showed up on April 15th, MSFT gained 3.00% on the following trading day.

Prices are trading close to the key technical resistance level at 186.23 (R1).

Though the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.

Buying might speed up should prices move above the close-by swing high at 186.67 where further buy stops could get triggered. With prices trading close to this year's high at 190.70, upside momentum might accelerate should the market be able to break out to new highs for the year. As prices are trading close to May's high at 187.51, upside momentum could speed up should the stock mark new highs for the month.

Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Microsoft. Out of 794 times, MSFT closed higher 49.50% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 62.34% with an average market move of 0.91%.


Market Conditions for MSFT as at May 22, 2020

Loading Market Conditions for MSFT (Microsoft Corporation)...
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