Key Insights:
- After a 40% drop over the past month, experts think that the MSTR stock shows signs of bottom formation.
- Despite heavy selling pressure and index-related concerns, TD Cowen maintains a Buy rating on MSTR with a $535 target.
- Strategy noted that the firm is resilient even if the BTC price crashes to $25,000.
Michael Saylor’s strategy is under hot discussion. MSTR stock faces severe selling pressure amid the Bitcoin crash.
Moreover, rumours of JPMorgan shorting the stock have added to further selling pressure. However, RSI levels flash buy signals for the stock, which could also mark the bottom for Bitcoin.
MSTR Stock Enters RSI Buy Zone
Crypto analyst Merlijn The Trader stated that the MSTR stock price has entered the Relative Strength Index (RSI) buy zone.
This is only the third time for such an occurrence in the past five years. Interestingly, each of these previous instances marked the bottom for Bitcoin.
Analysts note that oversold conditions exist across Bitcoin and the broader altcoin market. Moreover, the early signs of returning liquidity could signal substantial upside potential.
Another crypto analyst, Crypto Rover, stated that the MSTR stock has entered a critical technical phase, reaching oversold conditions.
A similar pattern appeared during the 2020 COVID‑19 market crash. It repeated at the bottom of the 2022 bear market and is showing again now.
The stock is simultaneously testing a major long-term support level. This positions it as one of the most significant technical levels.
The analyst noted that the stock’s oversold signals and structural support mark a pivotal moment for MicroStrategy’s Bitcoin-leveraged strategy.
TD Cowen Analysts Calls Buy on MSTR Stock
The MSTR stock price is already down by 40% over the month. With this, market experts see some opportunity to buy the dips.
TD Cowen analyst Lance Vitanza said MicroStrategy shares could remain under pressure due to a “sustained MSCI overhang.” However, he still maintains a buy for the stock with a $535 price target.
The analyst added that MicroStrategy’s approach extends beyond accumulating Bitcoin. Vitanze noted that the company is also creating new Bitcoin-backed securities for investors.
He argued that removing MSTR from major indexes would be arbitrary. He said it was unfair to do so just because it focuses on bitcoin‑backed credit. While explaining his thesis further, Vitanza noted:
Strategy Is Ready for $25,000 BTC Price Crash
Amid pessimism around MSTR stock, Michael Saylor showed confidence. He addressed concerns about possible MSCI exclusion. He pledged to weather even a BTC crash to $25,000.
The firm said Bitcoin could drop to its $74,000 cost basis. Its holdings would still exceed its convertible debt. The value would exceed that debt by a factor of 5.9.
In a more severe decline, with Bitcoin dropping to $25,000, the assets-to-debt ratio would remain at 2.0x.
In the latest on-chain development, Strategy transferred 58,390 Bitcoins, worth $5.1 billion, to Fidelity’s omnibus custody system. In this structure, assets are pooled with those of other clients, making individual transactions less visible.
The move has raised market questions. Investors wonder if the firm aims to reduce holdings or just access deeper liquidity.
Bhushan is a FinTech enthusiast and holds a good flair for understanding financial markets. His interest in economics and finance draws his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In his free time, he reads thriller fiction novels and sometimes explores his culinary skills.
