Microsoft stock eyes breakout above previous week high
Microsoft stock consolidates near 50% Fibonacci level after earnings rally
Microsoft Corp.'s stock price has experienced steady consolidation over the past five trading days.
This period of price stability follows an impressive bullish surge triggered by the company's robust quarterly earnings report, demonstrating continued strong demand among investors. Technically, this consolidation is taking place just above the critical 50% Fibonacci retracement level of Microsoft's most recent bullish swing, suggesting a balanced market condition between buyers and sellers.
Highlights
-Microsoft hovers above 50% Fibonacci retracement level after five-day consolidation
-Insider selling by top executives adds short-term pressure during resistance buildup
-A breakout above $462.58 could target $468.50 unless 50 EMA support breaks
Interestingly, the prolonged consolidation phase has coincided notably with internal executive activities. Executives at Microsoft periodically realise profits by liquidating portions of their holdings, potentially contributing to the temporary halt in upward momentum. On May 30, 2025, Takeshi Numoto, Microsoft's Executive Vice President and Chief Marketing Officer, executed a significant insider sale, liquidating 1,000 shares at a total value of $460,008. The sale reduced Numoto's direct holding slightly, leaving him control over 46,929 shares. While insider selling does not inherently signal bearishness, it can momentarily pause upward momentum, prompting investor caution and creating conditions suitable for sideways movement.
Microsoft stock price dynamics (May - June 2025)
Despite these insider sales, bullish confidence reappeared notably at the start of the week. On Monday, June 2, Microsoft's stock made a marked upward movement after briefly dipping to $457.00 during premarket trading. Investor sentiment swiftly shifted positive as the regular trading session commenced, propelling the price upward by 1.1% to reach a three-day high of $462.00. This bullish activity suggests underlying investor optimism regarding Microsoft's continued fundamental strength.
Microsoft’s hourly chart shows 50 EMA acting as intraday demand zone
Currently, the stock trades slightly below Monday's close at $461.58 during premarket trading on June 3. This level is positioned within close range of last week's notable high at $462.58, presenting a critical technical resistance zone. On an hourly chart, support has emerged around the 50 Exponential Moving Average, providing buying opportunities each time price declines occur within the consolidation zone. However, caution might be warranted due to the daily Relative Strength Index readings, which indicate an overbought condition.
Looking forward, a breakout above last week's high of $462.58 could decisively lift Microsoft towards its historical peak at $468.50. Conversely, if selling pressure intensifies, resulting in a breach below the hourly chart's 50 EMA, the next robust support lies around the 100 EMA, aligning neatly at the Fibonacci retracement level of 78.6%. This technical alignment provides a potential cushion against deeper corrective declines in Microsoft's share price.
Microsoft opened higher after the FOMC meeting but failed to hold gains near resistance. Price held above key support despite selling pressure into the close.
