Microsoft stock price forecast: Continued downside risk as MSFT stays below key resistance

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Microsoft drops 0.66% to $366.79 today

Highlights

Microsoft reported $81.3 billion in quarterly revenue, up 17% year-over-year, driven by strong cloud and AI momentum.
The company plans over $6.5 billion in cloud and AI infrastructure investments across Thailand and Singapore amid a UK regulatory probe into its cloud business practices.
Technicals remain bearish, with price trading well below major averages; the expected range for the next week is $355 to $375, with minimal probability of a rebound.

Record revenue growth offset by regulatory probe and heavy sector selling

Microsoft reported revenue of $81.3 billion for the second quarter of fiscal year 2026, a 17% year-over-year increase. The company announced plans to invest over $1 billion in Thailand and $5.5 billion in Singapore between 2025 and 2029 to expand cloud and artificial intelligence infrastructure. UK regulators initiated a probe into Microsoft's software and business software licensing practices in the cloud sector. These confirmed corporate actions and regulatory developments were accompanied by broader selling pressure.

Bearish technical posture as bearish signals cluster and volatility persists

The current price of $366.79 trades well below the SMA-20 ($387.34), SMA-50 ($405.01), and SMA-200 ($477.43), signaling persistent seller pressure across short-, medium-, and long-term timeframes. The Ichimoku Kijun level is at $384.64, which stands above the market and acts as immediate resistance. Momentum signals remain bearish: the MACD and ADX both point lower, suggesting downside dominance. Oscillators reinforce weakness, with the RSI and CCI in “Sell” territory and Stoch RSI offering a neutral daily stance. BBP is deep in oversold territory, highlighting strong seller control through the session. There was a slight gap down at the open versus the previous close, and the current price is hovering near today’s low, with intraday volatility best described as moderate. The overall tone since the open is one of sustained downward pressure. Pullback signals from some oscillators conflict with Stoch RSI's lack of strong extremes, indicating mixed short-term momentum.

Sideways bias likely as upside probability falls and risk increases

For the next 5 trading days, MSFT is likely to remain in a volatility band between $355 and $375. The probability of a price increase in the coming week is very low (under 20%), so further decline remains the expected scenario. Price action may stabilize in a sideways range within $355 to $375. A sustained move above immediate resistance at $384.64 would signal a bullish reversal, while a drop below $355 would expose additional downside risk.

Viktoras Karapetjanc, expert at Traders Union, sees Microsoft’s long-term strategy and robust earnings growth as key positives despite current technical weakness. He notes that regulatory scrutiny and soft price action are weighing on sentiment, but underlines that large investments in Asia signal confidence from management. The analyst believes that any short-term pullbacks will present opportunities once momentum stabilizes. In his words: “I expect MSFT to regain strength above $384.64, as strong fundamentals and ongoing innovation should ultimately outweigh current headwinds.”

Earlier, analysts noted that Microsoft faced persistent bearish momentum as regulatory scrutiny and ongoing seller pressure weighed on the stock. The current analysis reaffirms this cautious stance, with a break below $355 now emerging as the key risk that could trigger renewed downside in the days ahead.

Source of Data: MSFT Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.