Microsoft (MSFT) is garnering attention with its dividend hike and generous share buyback program. So, let's check on the charts and technical indicators to see if the powerful uptrend will continue into the fourth quarter.
When we looked at MSFT on July 27 we wrote that, "I learned about this quick-turning reversal pattern in the 1980s on a fixed-income hedging desk and I have found it to be pretty effective over the past 35 years. Raise stop protection to $280 from $265 or reduce your long exposure."
In the daily bar chart of MSFT, below, we can see how the stock made a shallow dip into early August and then resumed its uptrend. Our stop out point at $280 was not threatened. Today we can see that prices are trading above the rising 50-day moving average line as well as the bullish 200-day line.
The trading volume increased last month as prices rallied to new highs. The On-Balance-Volume (OBV) line has been stalled in July and August so renewed strength this month will be encouraging. The Moving Average Convergence Divergence (MACD) oscillator is narrowing and turning to the upside for a fresh buy signal.