BA, MSFT updates 09/12

BA: Has another strong day today and on the daily chart we can see how it is trying to break about above this triangle pattern in place since early June. Hence a breakout is significant if it happens. The technical indicators are turning back up to buy, and the MACD is coiling (also a triangle pattern since the June high; just draw upper and lower lines). Thus the breakout is more likely than not.

BA daily

From an Elliot Wave POV, I view BA as most likely having completed a triangle intermediate-iv wave -as intermediate-ii in 2015 was a zig-zag- and thus intermediate-v should be underway to new ATHs. A break higher targets low 400s to start with. That should then complete major-3 after which we should see an up to $150-160 decline for major-4. Only a break below the lower trendline, now at $337 and rising will invalidate this bull-count and setup. Hence, one could use this lower trendline as a stop if so desired.

BA monthly


MSFT: Another big boy (from Oregon, USA 😉 ) which is also nearing a larger top, but just not there yet. I realized I never had a big-picture count on this company, but like BA it counts really nice and clean. Note, here I count everything one degree higher compared to BA. Doesn’t really matter much for now as the pattern is the same and outcome will be the same. Only in the really long run will it matter because there’s a difference between completing a Cycle-5 wave vs a Primary-V wave… But that’s stuff for another time because as long as one has an exit strategy it really doesn’t matter if you can avoid a Cycle-2 62% haircut or a Super Cylce-2 62% hair cut…

For now, I see MSFT in intermediate-v of major-5 targeting around $120 (80/20 rule). From there we should see a Primary-IV wave down to $95-80, with obviously good support in the $85-90  region as that’s where major-4 bottomed. Once IV is in, we can expect V to target $125-130 to complete Cycle-3. What happens in Cycle-4 is everybody’s best guess, but it will be a multi-year -decades long- correction like Cycle-2. Nothing you want to hold your stock through IMHO. No idea either how deep a Cycle-4 will go. Can do a  standard 38.2% retrace ($45-$50/share haircut) or a much deeper correction.

For now, there’s IMHO still some upside left, but the downside risk will increase much more the higher price goes and starts to near $120. Protect those profits if you have them!

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