How Many Days Can Microsoft Drop?

How many days in a row can Microsoft drop?  If you have been around since before 2000 when the tech bubble burst, you know the answer to this can be a painful one.  Since Microsoft hit $31.00 in early January, it has been in a steady downhill slide since January 24, 2007.  That also coincides with the Vista launch.  There were not the lines and mad rushes inside the computer stores compared to the Xbox 360 or compared to Windows 98 or other launches.  What makes this launch entirely different is the processing power of PC’s, which means this is a much larger investment.  Most PC’s already on the market will not actually run that well on Vista because the processors and RAM may not meet the suggested requirements for a successful Vista OS experience.

The market hasn’t closed but today would mark the 6th day in a row of a drop and it has traded lower in 9 of the last 12 days.  The volume looks lower today so we may just be seeing a buyers strike, but the selling frenzy also ‘feels’ like it is lightening up.  The volume is also starting to lighten up, which is usually a good sign for dip-buyers that want to build positions, even if it is solely for a trade.  MSFT trades on average 61+ million shares per day. We still have to see how today turns out.

8-Feb  32M @2:20PM    $29.25
7-Feb  65,145,500    $29.37
6-Feb  79,281,100    $29.51
5-Feb  99,102,100    $29.61
2-Feb  60,401,700    $30.19
1-Feb  55,355,800    $30.56
31-Jan 73,968,400    $30.86
30-Jan    61,900,400    $30.48
29-Jan    57,605,900    $30.53
26-Jan    96,103,700    $30.60
25-Jan    97,378,700    $30.45
24-Jan    58,527,800    $31.09

Jon C. Ogg
February 8, 2007