Microsoft Stock Bounces Off Key Support as Wave (IV) Correction May Be Complete

Microsoft's stock has been on a sharp and impulsive bounce from its $350 area after experiencing a strong decline from its September highs. According to an Elliott wave analysis, this could indicate that a higher-degree wave (IV) correction may be complete, paving the way for a new higher-degree wave (V). On the daily chart, a five-wave impulse from the $347 lows suggests that bullish momentum is strong.

However, traders should be aware of the potential for a corrective setback before the broader bullish trend continues. The first important support area is seen around the open gap between $464 and $434, while a deeper support zone comes in around $400-$390.