#STUDY: Microsoft 3 year daily chart Fibonacci retracements | #MSFT

Updated December 9, 2013 ● 511 views
MSFT Fibonacci Chart

I'm a short term trader. I usually trade options on weekly basis. But I still look at long term charts to get an idea where a stock is heading.

Last week, I made quick 110% profit trading MSFT bounce from hourly 200ma. Looking at the daily chart in 3 year period, MSFT is sitting right on the 161.8% Fibonacci price extension level. Now, the last time MSFT traded at this level was more than a decade ago.

This means MSFT is in a tricky situation for long term traders. MSFT could pull back drastically here. If you are a long term trader, I would wait until the price breaks above the 161.8% price extension level. That price would be above $39.

As in my case, I'm still holding on my weekly call options purchased last week. I am playing profits for possible breakout above $39 with a target of $40. If it starts to pullback below $38.5, I would sell all my remaining position.

Last week trade: Microsoft could bounce off the hourly 200ma to target $40


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