Microsoft Stock Flashing Bull Signal Before Earnings

Microsoft have pulled back to its historically bullish 40-day trendline

Deputy Editor
Apr 25, 2023 at 12:22 PM
facebook X logo linkedin


Wall Street is eyeing earnings from several Big Tech names this week, with Microsoft Corporation (NASDAQ:MSFT) slated to step into the confessional after the close today. Analysts expect the company to turn in first-quarter earnings per share ranging from $2.15 to $2.29. Ahead of the event, MSFT is down 0.9% to trade at $279.30, and now trading near a historically bullish trendline.

Specifically, Microsoft stock just pulled back to its 40-day moving average. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, six similar pullbacks occurred over the last three years, and the stock was higher one month later 83% of the time, averaging a 4.6% gain. From its current perch, a move of similar magnitude would put MSFT above $292. 

The equity was rejected by the $292 level at the close on April 6, and the area has served as a ceiling on the charts ever since. Though it sports a marginal year-over-year deficit, Microsoft stock is up nearly 17% in 2023.

MSFT Chart April 252023

 

The security has a mixed post-earnings history based on the last eight quarters, and finished the next day lower after its last two reports. This time around, options traders are pricing in a 5.9% post-earnings swing for MSFT, which is slightly higher than the 3.7% move the stock averaged over the past two years, regardless of direction.

Options traders have focused on calls lately. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Microsoft stock's 10-day call/put volume ratio of 1.71 ranks in the 98th percentile of its annual range. This indicates an accelerated rate of call buying relative to put buying over the past two weeks.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI