Microsoft is breaking out

I love Microsoft (MSFT) as it has been very nice to me. It often listens to me and behaves as instructed. Most recently I said MSFT should go over $40 soon. Well, it just did! What is more impressive is that MSFT has just broken out its 10 years price channel.  As you can see below, MSFT was basically side-walking in the past 10 years without going anywhere. Now it has decisively gone over the top resistence line. This is very critical technically speaking. It often suggests MSFT may likely starts its next leg bull run. As I said many times in the past, buying, holding solid companies that pay high & increasing dividends and reinvesting the dividends can make you very rich in the long run. MSFT is definitely one of such stocks.

 

So should you buy MSFT now? Certainly it is not bad for a long-term investment. But if MSFT continues to listen to my instructions, then I think it may come down a bit first but it has a very strong support at around $38. Buying around $38-39 will be another great opportunity for you before it runs much higher. $45 is its next stop in the near term.

 

Microsoft is like a cash cow minting money for you non-stop. Buying such stocks has another great advantage: sleep peacefully at night during a severe market correction. I cannot tell you the exact date but this market is due for a correction, likely a severe one like a 10-15% decline that can happen any time now. When it does occur, great cash-rich companies like MSFT can fare very well when most people run for safety. See what happened here to such stocks during the last >10% correction.