MicroStrategy's stock price has clearly recovered in recent weeks, but now this rise may face its biggest test. When the market opens again for the last week of February, the stock is still very sensitive to both Bitcoin's weakness and changing investor sentiment.
MSTR is now trading close to 131 USD after rising nearly 30% from its bottom on February 5. Despite this increase, the stock is still down about 19% over the past month and more than 60% over the last three months.
This weak recovery now faces increased pressure from 100% institutional exit, weaker momentum, and significant technical resistance levels.
The biggest warning sign for MicroStrategy's stock price comes from institutional investors who have recently revealed their positions from the last quarter.
New 13F reports (delayed data) show that mid-sized investors are reducing or completely exiting their Strategy positions.
Angeles Wealth Management and Wealth Watch Advisors sold everything, thus reducing their holdings by 100%. Caitlin John LLC reduced its stake by 96.54% and now has only a very small position left.
Want more analyses like this? Sign up for editor Harsh Notariya's daily crypto newsletter here.
Other major investors did the same. Kovitz Investment Group reduced its equity stake by 19.31%, and the value of their holdings decreased by almost 62%.
Atomi Financial Group reduced its exposure by 18.61%. The value of their position fell by more than 61%. Even companies that held shares suffered significant losses. Invesco increased its holdings by 14.12%, but the value of their investment still fell by over 46%.
Such exits often signal reduced confidence, especially when the news comes during a recovery.
At the same time, MSTR's technical structure shows a hidden negative divergence. Between November 18 and February 20, the stock formed a lower peak, while the Relative Strength Index (RSI) reached a higher peak.
RSI is an indicator that measures the strength of price movements.
Since this divergence is seen in a broader downward trend, it suggests that the recent recovery may lose strength. The signal becomes stronger if the stock fails to break above resistance near 135 USD.
These reports reveal investors' positions during the recent decline (shown in the last quarter), indicating weaker institutional confidence.
Reduced trading volume shows weak confidence in the recovery
Technical volume indicators suggest that the support that remains may not be very strong.
An important measure is On-Balance Volume (OBV), which shows the total buying and selling pressure. Since February 9, MicroStrategy's stock price has mostly moved sideways, but OBV has fallen much more.
This indicates that the selling volume has been stronger than the buying volume during the rise.
When OBV falls faster than the price, it often indicates weaker conviction among investors, especially retail investors. It indicates that fewer want to buy MSTR stock at these levels.
However, not all signals are negative. The Money Flow Index (MFI), which shows capital inflow and interest during price declines, still shows some strength.
Between February 5 and 19, MFI formed a slightly higher peak, even though the stock price struggled to continue rising.
MFI shows buying and selling pressure by using both price and volume. When MFI rises while the price remains steady, it means some investors continue to buy during declines. Thus, this dip buying may explain why MicroStrategy's stock price has remained above the recent lows despite institutional investors leaving and low volume. It also explains the tick of 3% up over the last 5 days.
But dip buying rarely suffices to drive lasting uptrends. Without larger investments from major investors, the price often struggles to continue rising. Thus, the key MicroStrategy stock prices become extra important now.
Key price levels could determine MSTR's next major move
MicroStrategy's stock price is currently trading within a descending broader wedge pattern that has formed since November. This structure indicates continued volatility and uncertainty.
For the recovery to continue, MicroStrategy must first surpass 139 USD. This level is particularly important as it aligns with the 20-day Exponential Moving Average (EMA), a trend indicator that shows short-term price direction and weighs new price changes more heavily. The last time MicroStrategy reclaimed this level in January, the stock rose almost 15% shortly after.
If MicroStrategy surpasses 139 USD, the stock may strengthen and possibly reach 163 USD.
But the downside risks are much stronger. If MicroStrategy's stock price falls below 119 USD, the current structure weakens significantly. A larger drop below 106 USD could pave the way for a decline towards 96 USD and possibly even 86 USD.
That would correspond to a decline of almost 20% from today's level. MicroStrategy has a close connection to Bitcoin, so this risk means extra.
The company now owns over 717,000 BTC, making the valuation very sensitive to Bitcoin's price, which itself looks weak.
With institutional investors leaving, weaker volume, and resistance above, MicroStrategy's stock price is facing a critical situation. When the market opens on Monday, the next move may determine whether the recent rise of 30% holds or reverses.