Microsoft Stock Was Rejected At Resistance And Might Be Cooling Off As Tech Stocks Drop Tuesday

Microsoft Corporation (NASDAQ: MSFT) shares are trading lower Tuesday, as shares of several technology companies are trading down amid a rise in bond yields, which has weighed on growth stock valuations. The company also announced it is going to allow Epic and Amazon Games onto the Microsoft store.

Microsoft was down 3.16% at $284.88 Tuesday at publication.

Microsoft Daily Chart Analysis

• The stock looks to have recently been rejected at resistance and is falling back toward support in what technical traders call an ascending triangle pattern.
• The $305 price level held as resistance in the past and may continue to in the future. The higher low trendline is somewhere the stock has always been able to find support and may continue to in the future.
• The stock trades below the 50-day moving average (green), but above the 200-day moving average (blue), indicating the stock is likely facing a period of consolidation.
• The 50-day moving average may hold as an area of resistance in the future, while the 200-day moving average could hold as support.
• The Relative Strength Index (RSI) has been falling much lower lately and has dipped down to the 35 level. This indicates that the stock has had much selling pressure move into the stock in the past couple of weeks.

What’s Next For Microsoft?

Bullish traders are looking to see the stock dip lower and bounce off of pattern support. A bounce off the higher low trendline and a hold above this line are what bulls are looking for short term.

Bearish traders are looking to see the stock fall down to the higher low trendline and be unable to hold above the support line and break below. A break below the higher low trendline may indicate that the stock is changing trends and starting the beginning of a downward trend.

Image by efes from Pixabay