
Takeaways
- MicroStrategy’s shares rose more than 10% Monday, adding to recent gains after the stock’s recent decline.
- According to a regulatory filing, the software firm bought an additional 6,911 Bitcoins between March 17th and March 23rd, bringing its total to over 500,000 BTC.
- After initially finding buying interest at the 200-day moving average in recent weeks, the price closed above the 50-day MA on Monday, potentially setting the stage for a continuation of the stock's longer-term trend higher.
- Investors should watch major overhead areas on MicroStrategy's chart around $383, $543, and $870, while also monitoring key support levels near $232 and $180.
MicroStrategy’s (MSTR) shares rose more than 10% on Sunday, adding to recent gains after the stock’s recent decline.
The shares of the company, the largest corporate bitcoin holder in the world, have seen a boost since a regulatory filing revealed on Monday that the software firm purchased 6,911 additional bitcoins between March 17, and March 23, bringing its total holdings to over 500,000 BTC. MicroStrategy has not shown any signs of slowing down its accumulation of digital currency since 2020.
Shares of MicroStrategy, which does business under the name Strategy, have gained 16% since the start of the year as of Monday's close and have more than doubled over the past 12 months as investors turn to the stock as a leveraged Bitcoin bet. The stock rose by 10.4% on Monday to $335.72 as bitcoin’s price increased.
Below, we breakdown the technicals of MicroStrategy’s chart and highlight major price levels to watch for.
Buyers Emerge At 200-Day Moving Avg.
MicroStrategy stocks traded sideways for a few weeks after retracing their 200-day moving mean. Then, renewed buying interest was seen.
Recently, the stock closed Monday above the 50-day MA, which could set the stage for a continued uptrend in the longer term.
The relative strength (RSI) index flashes a positive reading above 50, signaling a bullish momentum in the price, but is also below overbought levels. This gives the stock ample room to move higher.
Let’s use technical analysis to identify areas of the chart that investors are likely to be watching. We will also highlight support levels during possible pullbacks.
Major Overhead Areas To Monitor
The first overhead zone to watch is at $383. At this level, the shares may face selling pressure near a series peak and troughs formed on the chart in mid-November through late January.
Buying above this area could set in motion a rally towards $543. Investors who bought shares during the stock retracement could look to lock in their profits near the all time high (ATH) that was set in November of last year.
Investors can project a target above the ATH using the bars patterns tool. This tool works by extracting a stock’s trending movement from September to last November and repositioning at the 200-day MA. This analysis forecasts an $870 target and indicates that the trend could continue until late May, if price action coincides.
Key Support Levels to Watch
Investors should first watch the $232 mark, which is a level on the chart that may provide support near the low of early November, and the recent troughs of February and March.
A more significant drop would likely see MicroStrategy’s shares return to the lower support level of $180. Investors might look for opportunities to buy at this level, near a line that connects several prominent peaks between March and the end of July last year.
Investopedia’s comments, opinions, and analysis are intended solely as information. Read our warranty and liability disclaimer for more info.
As of the date the article was written, author does not own any above securities.