Chart of the Day: Flat Base For Microsoft Sets Up a Bigger Move
When the news is positive and the price action responds in kind, there is something bullish in the air.
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After a monstrous run higher following a surprise earnings beat in July, Microsoft (MSFT) is now just moving sideways. As you likely know, building a long, solid base is a good way for a stock fortify a trend. Call it a rest stop for the trend, which is now considered bullish. Higher highs and higher lows in the chart below define Microsoft’s move here and while the indicators look bearish they seem to have slowed down from the fever pace in August.
Money flow remains positive and the price action is constructive, though we do now see the candles turning amber in color, which is neutral. The heat from the previous move has cooled off a bit. With much of the uncertainty in the news about AI, growth and the place for software it is not surprising to see Microsoft moving too far ahead.
In addition, competitor Oracle (ORCL) last week rallied and gave back all of its gains as it struggles to move forward with their own AI initiatives. As we move toward the end of the third quarter of 2026 and look to earnings season we want to see momentum return to the biggest names to show leadership. Microsoft is one of the keys.
We like Microsoft in TheStreet Pro Portfolio and rate it a Two, or “stockpile on pullbacks.”
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At the time of publication, TheStreet Pro Portfolio was long MSFT.
