The 456.88 target shown presents itself so clearly on the monthly chart that I am de-emphasizing the 452.35 target of a lesser pattern given here earlier. The latter could still show some stopping power, and we should therefore remain alert to the possibility that it will generate a major top. We can attempt shorting there, too, but the higher target is where we'll train our firepower. It caps a pattern that is more obvious than we should prefer, but my use of a quintessentially 'textbook' one-off 'A' might give us an edge over traders who will be using the somewhat higher 462.80 target associated with the marquee low at 213.43.
Energized by eight weeks of consolidation, MSFT has fist-pumped past a 430.58 target that had looked capable of stopping the bull in it tracks. It did, and quite precisely, but only for long enough to give bulls a running start on new record highs. They will nearly always be precisely targetable, and I've selected a conservative one for now to give us a confident handle on trend strength. Look for the stock to reach a minimum 452.35 this week, or 455.95 ii any higher. The latter number was calculated by sliding the point 'A' low down to a somewhat lower bottom a few bars to the left. Both numbers are shortable provided you use small-pattern triggers to cut the risk.
It's hard not to grow impatient with MSFT's tiresome slog toward the 456.88 target shown in the chart. The stock has spent most of 2024 diddling the secondary Hidden Pivot (p2) at 420, but it seems likely to get there eventually. The 430.58 target of a lesser pattern seemed to work well initially as a possible bull-market top, since the stock hasn't exceeded it by more than a couple of dollars after first hitting it in mid-March. But neither has it given up much ground since, a fact that attests to the confidence the stock's sponsors have that higher prices are coming.
The bullish pattern shown, with a 457.12 target, is unlikely to steer us wrong, given the precise, confirming pullback from p=383.41. It is ambivalent on the question whether D will be reached, however, so we'll accommodate simply by being prepared for that -- or anything else. My gut feeling is that the stock will need to correct further before that could happen, so we'll look initially for a 'mechanical' buying signal on a pullback to p=383.41. The by-the-book stop-loss would be at 358.84. By implication, any rally of 10-25 points should be regarded as an opportunity to get short.
Seven weeks after precisely achieving the 430.58 bull market target I'd aired in 2023, MSFT has yet to push more than slightly above it. My gut feeling is that buyers would have impaled the Hidden Pivot on first contact if they had the moxie to push the stock to D=452.35. For that reason, I expect a sharp pullback from these levels before bulls can try again. I doubt the selling will reach the green line (x=404.11) to set up a 'mechanical' buy, but I'll be looking for opportunity to develop at p=420.19. I don't plan to trade this one, but merely to observe it. The stop-loss would be at 409.47, with a goal of reaching p2=436.27, if not D.
The 430.58 target first broached here in 2023 has shown remarkable pluck, but it seems fated to give way, if perhaps only marginally, because of last week's poke above a challenging 421.63 Hidden Pivot resistance derived from a lesser pattern. There is no logical rationale for a strong burst higher right now, but we cannot rule it out because the stock market remains in the grip of mass psychosis. We'll remain on high alert nonetheless, ready to exploit a head-fake that could provide exceptional leverage for a precisely timed purchase of put options. On the weekly chart, using A=366.50 from 1/5 yields a 452.35 target that looks well suited to that purpose.
The rally off the 389 low recorded on April 29 has exceeded just one 'internal' peak, meaning it is not impulsive, strictly speaking. It also left the stock well shy of the 430.82 high recorded on March 21. Subscribers will be familiar with that number by now, since it was first introduced in 2023 as a potentially very important rally target. I'll be interested to see whether the stock languishes well below the high even as the S&Ps push to a new record. We'll be on our guard in any case, prepared to short this little monster if it shows even subtle signs of topping. A reverse-pattern target at 421.63 still looks like our best bet for this to occur.
The bullish reverse pattern shown implies that the rally that ended the week is bound for a minimum 421.63 -- still somewhat shy of a major Hidden Pivot resistance at 430.58 that has capped AAPL's bull market since mid-March. We'll wait to see how buyers handle the resistance before we infer that new record highs are coming. If so, let's be alert to the possibility that a marginal feint into record territory would fake out enough bulls and bears to set up a hellacious dive similar to one in IBM that I featured here a while back.
MSFT blew past the 404.83 midpoint 'hidden' resistance of the pattern show before settling back, penetrating it with sufficient force to imply that the rally is likely to achieve the D target at 421.63. That would still leave the stock somewhat shy of a 430.58 target that was first aired in 2023 and which has held precisely for more than a month. We should be prepared for a marginal new high, since that would set the kind of hook that would trap bulls and bears alike as the latter scrambled for cover. We'll be ready to exploit any such 'fooler' if it happens.
The stock's steepening fall last week put more distance between it and the all-time high a month ago at 430.82. That was just 24 cents from a longstanding target I'd said could cap the bull market begun in 2009. Perhaps it has, although I'd like to see MSFT fall at least 30%, to $300, before I consider the prediction fulfilled. Odds of this will shorten if the new week begins with just slight weakness. Anything exceeding 397.21 to the downside would breach three (!) external lows on the daily chart, creating a powerful impulse leg with devastating potential.
