MicroStrategy Breaks Below 200-Day Moving Average as Bitcoin Correlation Weakens
MicroStrategy (MSTR) dropped to a five-month low of $326 on Wednesday, falling roughly 4% beneath its 200-day moving average of $340—a key technical level that has historically served as both support and a trend indicator for the stock.
The 200-day moving average is widely used by traders and institutional investors to assess long-term momentum. A break below this level often signals weakening sentiment or the beginning of a sustained downtrend.
Over the past month, MSTR has declined 21%, far outpacing bitcoin’s 3.5% drop in the same period, raising questions about the durability of the company’s long-standing correlation with the crypto asset. The divergence suggests growing skepticism among investors toward the firm’s leveraged bitcoin strategy.
MicroStrategy has previously rebounded off its 200-DMA, including during the April 2025 “Trump tariff tantrum” and in mid-2024. Whether this latest dip proves temporary or marks the start of a broader downturn remains to be seen.
Chanos’ Short Bet Gains Momentum
Renowned short-seller Jim Chanos recently revealed he is shorting MicroStrategy while taking a long position in bitcoin itself—a relative value trade that is now showing strong returns.
Market analyst J.C. Parets highlighted on Wednesday that the ratio between MSTR and BlackRock’s IBIT, a spot bitcoin ETF, has dropped to a five-month low. “This one is accelerating quickly,” Parets said, noting that MSTR’s underperformance relative to direct bitcoin exposure is becoming increasingly pronounced.
With investors pulling back from risk-on tech and crypto-adjacent equities, MicroStrategy’s position as a proxy for bitcoin is being tested. If the stock fails to reclaim the 200-DMA soon, further downside could follow.
Share this content:
