We mentioned last week that the tech sector had taken the brunt of the selling pressure, but it was also showing the most signs of potential for a bounce back to highs. This week is off to a good start as some of the large-cap technology names are bouncing from significant support levels.
This morning’s big stock charts look at the charts for Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) and Advanced Micro Devices, Inc. (NASDAQ:AMD) all of which are making advances this morning after hitting relative technical support levels.
Microsoft Corporation (MSFT)
Microsoft’s move to subscription-based services and efforts to focus its business on enterprise software solutions has put MSFT stock in great fundamental shape, as evidenced by the strong bullish trend and higher forecasts.
- Shares of Microsoft recently bounced off their 50-day moving average, which is trending higher. This support line has held MSFT stock in a strong bullish trend since October of last year.
- Microsoft shares are now seeing increased buying interest after that technical test as the chart watchers are buying into the continuation of the trend.
- While MSFT shares did not hit a technically oversold reading on its RSI, the stock was able to work-off an overbought reading that marked the top of the stocks rally at $73. This indicates that there is momentum and volume out there prepared to drive the stock back to its highs and likely towards $75.
Alphabet Inc (GOOG)
The real internet of things company, Alphabet, made a swift move to $920 a few weeks ago and has had a heck of a time forming what we would usually refer to as a tradable bottom.
That said, it appears that GOOG is ready to make a run at taking out its highs at $990.
- While the stock isn’t touching down on its 50-day moving average, the critical trendline is in position to provide support at $920 and it is rising at a relatively fast rate. This will help drive Alphabet prices higher.
- GOOG shares pulled back from a technically oversold situation and are now trading at more moderate technical valuations. This means that the stock once again has space to move higher with less impediment from becoming technically crowded with buyers.
- Teechnical traders will watch the $960-level very closely as this represents round numbered resistance and is very close to the May closing price for Alphabet stock. Watch for a move above this level to initiate a rally to $1,000.