Long term Volume Observation in Microsoft MSFT

May 18, 2010: 2:46 PM CST

I was glancing over the monthly charts of leading stocks and found an interesting volume trend in Microsoft (MSFT) over the years that’s worth mentioning.

Let’s take a look:

There’s a few things that leap off the chart at me, starting with the lengthy declining trend in monthly volume, as shown both by the red arrow and blue 20 month average of volume – both of which have steady slopes lower.

The volume drop-off has become increasingly noticeable from the 2009 market lows of $15.00 per share – a level not seen since 1998.  Volume across the board since then has been lower, but it’s worth showing in the chart above.

Next, just as a historical point of reference, if you look at the arc formation that developed during the “Bubble” years of Microsoft, you’ll see a similar, more obvious perhaps, declining trend in volume well-in advance of the 2000 peak before the bubble burst and price collapsed.  Interesting.

Another point that may have slipped your notice is that price is sitting roughly where it was 10 years ago.

If you ask the average person who doesn’t know much about stock market prices, I’m sure they would assume that Microsoft, being the ubiquitous company that it is, certainly had to have a continually rising stock price over the years.  Not so.

In fact, with the exception of the volatile up/down/up swing of 2007 to present, Microsoft’s stock stayed very tightly bound around the $20 to $25 level for about 5 years.

Microsoft – at least chart-wise – behaves more like a Blue-Chip, stable company than a high-flying Google or Apple.

These are more just interesting observations on volume and price stability rather than a “here’s what’s going to happen next” in Microsoft post – food for though.

Corey Rosenbloom, CMT
Afraid to Trade.com

Follow Corey on Twitter:  http://twitter.com/afraidtotrade

3 Comments

3 Responses to “Long term Volume Observation in Microsoft MSFT”

  1. Kay Says:

    Um,….wow, not sure what to do with that…. Uh, thanks!

  2. albot Says:

    Cory: Any guidance on the best way to short the Chinese market, either Xinhua 25, Shanghai Comp, or Hong Kong? I am long FXP but would rather find an unleveraged inverse ETF to buy.

    Thanks
    Albot

  3. Corey Rosenbloom, CMT Says:

    Same here! Just an observation. Sometimes it's helpful to look at monthly charts… other times not.