EWT on MSFT

Category: Specific Markets

Question:

A weekly chart of Microsoft (MSFT) looks to me as if the stock may be completing a massive contracting triangle which has been in force since its December 2000 low. The year-long decline from the stock's all-time high in December 2000 looks impulsive, perhaps an a-wave of some degree, and the choppy, sideways action since could then be a b-wave triangle. This of course would portend a c-wave down to come that would likely be quite severe. What do you think?


Responder: Multi-Author
Date: 8/5/2005
I would tend to agree, particularly given the well-formed three-wave corrective rise from the low in December 2000. By my count, the overlapping rise from mid-2002 is wave C of the pattern. It is impossible to determine where we are in that C right now, although measurments put a target at $28.73 to $29.13, with the upside limit near $35. The triangle appears to need more work before completing, but most of that should be done at lower levels. (This analysis was performed by our Flash analysts who issue trading recommendations for single stocks in Prime Stocks Flash, one of our three Flash products. The Flashes are designed for investors who want to trade using the Wave Principle, but have no time or expertise to do so on their own. The Flashes give you actual trading recommendations on everything from individual stocks to futures. Our analysts pick the trades for you and contact you with exact instructions: what market, long or short trade, at what entry price, at what exit price, stop-loss, etc. Everything that goes into a trade, we give you. You then contact your broker and tell them to put on the trade. Or, you can authorize your broker to receive our recommendations directly. That way, you don't get personally involved in trading and let the professionals do everything for you. You'll find the full description of the Flashes here, and our Customer Service representatives could also help you with any questions.)