MSFT sold off hard after wafting into the middle of the supply zone I’d detailed here last week. Accordingly, I’ve used a somewhat unorthodox, bearish reverse pattern to tell us whether there is any conviction behind the selling. Use 438.46 as a minimum downside target for the near term, and don’t hesitate to try bottom-fishing there, especially if you know how to set up a ‘camouflage’ trigger that would limit entry risk to no more than 5-10 cents per share. If sellers crush the ‘hidden’ support at 438.46, expect more downside to D=420.76. That would be a big deal, since MSFT’s recent strength has restored it to its position as the most important stock in the world — not merely a bellwether, but THE bellwether for the everything bubble. _______ UPDATE (Dec 18, 11:59 p.m.): It’s possible that my decision to resurrect Microsoft as our #1 global bellwether may have caught a very important top. MSFT’s unsettling plunge today was nastier than we might have expected, especially considering the company’s revenue stream from recurring subscriptions is practically bomb-proof. And yet, the stock fell 3.76%, trailing only Amazon and Tesla in the megastock loser’s column. The latter’s share price is so bloated with Musk-worship in a dangerously saturated EV market that TSLA will undoubtedly turn out to be the best short in the lunatic sector once the bear market has run its course. I’d warned in the current ‘Morning Line’ (see above) that Mr Market might throw the kill switch at the height of Santa season, the better to crush the multitudes who evodently fear an ugly surprise, if it materializes, early in the new year. If Wednesday’s selling picks up tempo into week’s end, we’ll have our answer: a Christmas bloodbath for investors. How very clever it would be for Mr Market to disguise the onset of an epic bear market as a merely corrective reaction to today’s mildly hawkish pronouncement from the Fed.
MSFT – Microsoft (Last:441.10)
