MSTR Stock Crashes to 6-Week Low as Strategy Sells BTC Holdings
Highlights
- MSTR stock price crashed by over 5% on June 1 after Strategy revealed a sale of 32 BTC.
- The sale also caused a crash in Bitcoin price to the lowest level in two months.
- Strategy also sold 801,994 shares to raise an additional $128 million.
Strategy (NASDAQ: MSTR) stock was trading at $150 at the time of writing after dropping by 5.5% because of news that Strategy was selling Bitcoin for the first time since 2022. Strategy shares are now at their lowest price since April 17.
The company selling Bitcoin has caused retail traders to start selling because of panic, and this has made the BTC price to drop to its lowest price in two months of $70,700 and Strategy shares are also crashing.
Saylor’s Strategy Sells Bitcoin Holdings, Fuelling BTC Drop
CoinGape reported that Strategy sold 32 BTC worth $2.5 million, and this has sent those people who are holding Bitcoin into a frenzy because it is the first time that Strategy is selling since 2022.
Strategy Executive Chairman Michael Saylor had hinted at this sale several weeks back, and Strategy even made a filing saying that it might use the money it will get from selling bitcoin for a $1.5 billion bond repurchase.
But the market was still not prepared enough for Saylor to abandon his “never sell” Bitcoin stance because Bitcoin went from $73,000 to $70,000 a few hours after this sale was made public.
MSTR stock also dropped by 5.61% $150.61 because Strategy also sold 801,994 shares.
Jim Cramer says that Strategy was like a trampoline for Bitcoin, but this prop is no longer there after propelling the price up since 2022.
“May have to reevaluate pro-bitcoin stance given how much Strategy has propped it up… Some say manipulation. I think that’s too strong,” Cramer said.
Strategy still has 843,706 BTC, but it still needs cash because it needs to pay those who are holding STRC with a dividend rate of 11.50%, and it has to get $1.5 billion to buy back bonds, meaning it will likely sell more BTC.
MSTR Stock Crashes as Bearish Signals Emerge
MSTR stock price closed trading on Friday at $159 after rising by 6.7%. But all these gains were wiped out on June 1 because of the Bitcoin selling news. The stock even crashed to $144 at some point during the day before stabilizing at $150.
This crash has given bears a good grip because the AO bars are now negative and growing in length. The RSI reading of 40 also shows that the momentum is favoring bears.
The first support is at $150, and this is where MSTR stock is trading at today. The stick might crash again to $135 if it does not get a good footing here at $150.
MSTR stock may rebound to the obstacle at $166 if there are no more sales in the near term and the market reconciles with the fact that Saylor has abandoned his “never sell” Bitcoin policy.
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