Market analyst Sir Chartist has projected that MicroStrategy's stock (ticker: MSTR) could experience a sharp decline to around $350 before staging a notable recovery to $700. This forecast is grounded in technical indicators such as the stock slipping below its 9-day exponential moving average (EMA) and 20-day simple moving average (SMA), which are converging in a bearish pattern indicative of fading short-term momentum.
Volume trends reinforce this outlook: spikes in selling volume on down days suggest sellers' dominance, while a subsequent decrease in selling volume combined with stronger buying volume could signal the bottoming of the stock. Sir Chartist emphasizes watching for a shift in volume as a key indicator for a reversal.
MicroStrategy plans to raise approximately $2.1 billion via stock sales to further increase its Bitcoin holdings. While additional Bitcoin acquisitions could positively influence the stock price in the longer term, the equity raise may exert downward pressure during the transaction period due to share dilution.
Crypto analyst Ali Martinez has also provided a bearish viewpoint, noting the presence of a TD Sequential sell signal on the weekly chart, often predictive of imminent price corrections.
Historically, MicroStrategy's stock has delivered substantial rallies from consolidation phases, including past 100%+ gains following breakouts from sideways channels. Sir Chartist suggests the current multi-month base might support a similar rally after the anticipated dip, but cautions investors to be mindful of the significant volatility and trend shifts that could occur.