MSTR Stock: Potential Crash to $350, Then a Rally to $700?
MSTR Stock Price Prediction: Dip Before the Surge?
Market expert SIR CHARTIST recently released an analysis predicting a potential drop in MicroStrategy (MSTR) stock to $350 before a substantial rally to $700. This represents a potential 100% increase from the predicted low point.
According to SIR CHARTIST's X post (link), the key indicators to watch are increasing panic selling towards the $350 level, followed by a reduction in sell volume and a rise in buy volume (indicated by green candles on the chart).
The expert cautions that current market conditions are different from those seen in April. Simply expecting continuous price increases is no longer a viable strategy.
SIR CHARTIST points to the MSTR stock price being below both the 9-period exponential moving average (EMA) and the 20-period simple moving average (SMA), with a bearish convergence between the two. The consolidation period followed by high-volume breakdown further supports the bearish outlook. This, coupled with MicroStrategy's plans to raise $2.1 billion through stock sales to purchase more Bitcoin, adds complexity to the situation.
The Potential Rally to $700
Despite the bearish prediction, SIR CHARTIST highlights a past price action pattern where a similar channel breakout resulted in over a 100% return with minimal downside. Investors are urged to study this historical move as the expert believes it could repeat.
The analyst emphasizes the importance of observing sideways channels in highly discussed retail stocks like MSTR. The recent reversal candle after a significant rally is interpreted as a shift to a downtrend, with high-volume selling and an intraday reversal candle indicating exhaustion. Investors are advised to protect their positions given the potential for trend reversal.
Crypto analyst Ali Martinez echoes this sentiment, noting a sell signal on the weekly chart using the TD Sequential indicator, suggesting an upcoming price correction.
Future MSTR price movements will likely depend on MicroStrategy's Bitcoin acquisitions and overall market sentiment. Volume will be a key indicator in the coming week.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Conduct thorough research before making any investment decisions. Codeum is not responsible for any personal financial losses.