MicroStrategy Stock Price Under Stress With 35% Downside Risk

Key Insights

• MicroStrategy (MSTR) stock price tracks the recent dip in Bitcoin price below its average buy level.
• $3.2B in paper losses is weighing on investor confidence.
• Support near $107 and $82 remains at risk if weakness continues.

MicroStrategy stock price is trading near $129, far below its highs from last year. The drop has been steady, not sudden. Over the past few months, the stock has moved lower step by step, following weakness in Bitcoin.

The main reason is simple. Bitcoin is now trading near $71,500. That is below MicroStrategy’s average buying price of $76,052. For the first time in a while, the company’s massive Bitcoin position is sitting in clear paper losses. That change is starting to affect how investors look at the stock.

Instead of focusing only on Bitcoin’s long-term story, the market is now paying more attention to balance sheet risk and short-term pressure.

Bitcoin Losses Impact MicroStrategy Stock Price

MicroStrategy holds 713,502 BTC. This is one of the largest corporate Bitcoin positions in the world. The company has built this stash over several years using debt and share sales.

At current prices, that Bitcoin reserve is worth about $51 billion. The total cost is around $54.2 billion. That creates a paper loss of roughly over $3.2 billion. That number keeps changing as the BTC price keeps dropping.

These losses are not realized. The company has not sold its Bitcoin. But on paper, the position is now underwater.

This changes how people think about risk. If Bitcoin keeps falling, those losses grow. If Bitcoin stays below $76,000 for a long time, pressure builds. Currently, the BTC price is close to losing $70,000

Balance sheet stress is now being talked about by analysts as one of the key stock price drivers. That shift in tone is important. It shows confidence is becoming more cautious.

MicroStrategy (MSTR) Stock Price Structure and Weak Retail Demand

The technical picture does not look strong right now. Earlier this year, MicroStrategy (MSTR) stock was holding above $139. That level acted as support for months. Buyers stepped in there many times.

That support has now broken. Once $139 failed, MSTR stock selling picked up. The stock slipped quickly toward $129 and has not recovered yet.

Below this zone, the next major support sits near $107. If that level fails, the chart opens up toward $82. From current prices, that would mean a drop of more than 30%.

Volume data also shows a problem. On-Balance Volume, or OBV, fell. This means retail participation continues to fade. Fewer small investors are buying dips. More are stepping aside.

When OBV falls with price, it usually shows weak confidence. People are not rushing in to buy. They are waiting.

This fits the current mood. Many traders are no longer chasing MicroStrategy for Bitcoin exposure. They are becoming more selective.

Without strong retail demand, rebounds tend to be slow and limited.

Institutional Buying Offers Some Support to MSTR Stock

While retail interest is waning, large investors remain active in MicroStrategy (MSTR) stock. Chaikin Money Flow, or CMF, has been trending higher in recent weeks. This suggests that some bigger players are quietly buying.

CMF measures whether money is flowing into or out of a stock. Rising CMF during a price decline often means institutions are building positions slowly.

This creates a mixed picture. On one side, retail investors are pulling back. On the other side, larger funds appear to be positioning for the long term.

This is not unusual in downtrends. Institutions often buy when sentiment is weak. But that does not mean prices will rise immediately.

It only means there is some underlying support. And that could be the reason why the analysts’ target for the MicroStrategy stock price still shows $387. This shows that even optimistic analysts are becoming more careful.

Right now, the debate around MicroStrategy is changing. Earlier, the focus was simple. If Bitcoin goes up, the stock goes up.

Now, investors are asking different questions. How long can Bitcoin stay below cost, and how much debt pressure is there? On the other hand, they are also wondering how much downside the stock absorbs.

As long as Bitcoin remains under $76,000, these questions will not go away. For MicroStrategy stock price to regain strength, two things are needed.

Bitcoin must recover above the company’s average cost. And the stock must reclaim $139.