Microsoft Corporation (NASDAQ:MSFT) Reports after the close, Thursday, Apr. 25
Wall Street expects Microsoft to earn $1.00 per share on revenue of $29.84 billion. This compares to the year-ago quarter when earning were 95 cents per share on $26.82 billion in revenue.
What to watch: Shares of Microsoft have risen nearly 13% over the past three weeks, suggesting Wall Street is all in on the company’s long-term growth prospects, thanks to the company’s strength in its Commercial Cloud business. The company’s growth narrative is closely tied to its Azure Cloud platform, which competes with Amazon’s AWS. UBS analyst Jennifer Swanson Lowe, who has a $125 price target on the stock, remains optimistic on Microsoft heading into the quarter, anticipating commercial cloud revenue growth of 39% on the back of 66% growth in Azure and 26% revenue growth in Office 365 Commercial. On Wednesday investors will look to see if these growth trends can continue.
While we don’t want to fall victim to its short-term thinking, understanding Wall Street sentiment can provide context for the market’s reaction to a company’s earnings report. Analysts’ consensus estimates are calling for revenue of $29.84 billion, up about 11.3% from the prior-year quarter, and earnings per share of $1, up 5.3%.
Microsoft’s software business continues to take a back seat to its cloud computing ambitions. As more and more companies begin to see Amazon as a competitive threat, a growing number of those could view Microsoft as a safe haven, and an important alternative to sleeping with the enemy.
We’ll know much more when Microsoft reports.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
The projected upper bound is: 126.74.
The projected lower bound is: 120.70.
The projected closing price is: 123.72.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 85.1206. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 1 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 74.83. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 19 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 197.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 8 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 0 period(s) ago.
Rex Takasugi – TD Profile
MICROSOFT CP closed up 1.600 at 123.370. Volume was 10% below average (neutral) and Bollinger Bands were 35% narrower than normal.
Open High Low Close Volume___
122.190 123.520 121.302 123.370 27,990,998
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 120.75 114.63 109.09
Volatility: 10 17 33
Volume: 17,614,214 24,068,046 30,556,404
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
MICROSOFT CP is currently 13.1% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of MSFT.O at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on MSFT.O and have had this outlook for the last 64 periods. Our momentum oscillator is currently indicating that MSFT.O is currently in an overbought condition.
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