Microsoft Is About To Correct; Time To Trim

2023年12月6日

Microsoft is in a really weak technical position right now. After breaking out of it's previous flagging pattern, the stock's ADX has since topped out, and we're seeing the beginnings of a bear trend for shares in the stock.

While the stock has come in somewhat and is no longer as overbought as it was last Wednesday, we still think there's downside room:



It's true that the company continues to grow revenue and profit, but the company has stopped buying back shares in the open market, and the stock is trading at a relatively expensive valuation, now above 12x sales:



The company has room to the downside, especially when combined with a broader technical environment which looks to be a little too strong. We're not blind to the possibility of a further Santa rally, but it doesn't seem like MSFT has as much gas left in the tank as some of the laggards of 2023 which are still waiting to catch a bid, like UNH and HD

Cheers!

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