Long

MSTR Can Double Your Gains

Updated

Microstrategy has been the foremost Bitcoin related stock outside of the miners or ETFs.

Ive noticed that MSTR tends to be significantly better correlated than some of the other BTC related plays, however you must be careful as it acts as a leverage play as BTC moves. You will generally see MSTR move 2x - 3x the percentage move of Bitcoin.

Looking through the chart, we can clearly see a bullish trend on the hourly time frame, however we may have potentially reached a physiological limit at 2k as price rallies before a sharp rejection.

I would be welcome to a nice pullback towards the lower level range around $1600 where MSTR left a large gap prior to pumping. This would be a strong buy zone if Bitcoin continues to rally to new all time highs.

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Would love to see this scenario play out

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Here is what I am watching now

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The bigger picture

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Careful of the trendline, clearly MSTR is very sensative now. BTC is rallying at highs while we are struggling to hold some levels

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Level to level

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Waiting to see what happens at VWAP.

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Rejection at the VWAP and 21 ema at the moment. This big support zone will be critical and likely act as a magnet. I will place some limit buys at 1600, 1550, and 1500.

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Will be patiently waiting for this one moving into next week

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Coming into our range

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Starting to form divergences

Trade active

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Lets see if we bounce from this zone. Orders filled at 1600

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MSTR opening up at $1480. All orders having been filled.

If we close a daily below $1400, and BTC has a larger correction I will exit the trade and look for better entries.

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So far moving according to plan

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Now that the stock is starting to move, managing my risk will be the most important part of the trade.

I am moving my stop up to $1580 (daily candle close).

As long as BTC is bullish, my bias remains long and chill unless the trade is stopped out.

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Additionally, to add confluence as to why my bias remains bullish are the following indicators:

1. Nice break of the 21 EMA on the 45 min candle. In the past, breaking above this trend line has resulted in bullish price action.

2. We have unfinished highs at the top of the range. Generally, you want to see a wick above a previous high before a reversal. This would indicate trapped traders at the top. We have not quite seen a wick there yet.

3. Finished lows at the bottom of the pullback, below the gap before we had the last pump. Notice how price action wicked below the low before reversing, indicating trapped shorts at the bottom of the move.

4. Longer term trend is still clearly bullish. Price is making higher highs, and higher lows.

Resistance levels to the upside are marked on the chart.

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Nice gap up in the morning, holding our support. Potential to fill the gap below where buyers may step in again.

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Watching the gaps

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Gap Filled as expected. Market is in a sensitive spot at the moment, but we also have a potential bear trap setup for tomorrow.

I will be watching these critical levels just below $1600.

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Exactly as per last nights plan, we are seeing the bear trap play out. Key resistance to hold above us will determine if we are going higher, or if we will get smacked back down.

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Resistance level at $1650 (21 EMA)
$1700 S/R flip

Looking for 15 Min / 30 min close to determine direction.

Daily candle close today is quite important.

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First resistance hit, pulled back to previous day close and starting to bounce.

Market giving another trade idea, breaking the trend line would be a great sign of strength.

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Trade stopped out! Looking for new entries

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Currently getting the same bull signal on the 45min that was last present when mstr traded at $680.

Currently trading within Value area, after bouncing from the VAL into the Range POC before a rejection.

It would be critical to find support here, which may potentially indicate a large move ahead.

I would be willing to build a position at these prices, break below $1370 would invalidate the idea.

Regardless, I do feel like Bitcoin is still quite bullish and its tough to fight the trend. These swings are just part of the nature of such a volatile asset, but the longer term picture is still bullish on the charts.

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zoomed out

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Starting to build a position here on MSTR again as we are nearly 50% off the high. Will be DCA here split in 15% incraments with a larger order if we swing failure pattern at the low of the liquidity zone just below $1100.

Trade active

Alerts triggered. 50% retrace from the top.

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Nice move off the liquidity zone.

Here we have reclaimed the value area low and moving around the poc. A strong close above may potentially initiate a squeeze up to the value area high just above $1600.

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Forming a nice inverse head and shoulder pattern

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From $1000 to $1500 in 2 weeks.

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Exactly as predicted

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Ive taken quite a bit of profit and will let the remainder ride here.

I am currently looking at a test of the previous Value Area High, in confluence with the CC fib zone pulled from the top to bottom of the move as a possible bounce zone.

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If we lose that level, and retest with a rejection we are likely to move down to the range POC around $1300.

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Nicely held the low at 1620 zone

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After retesting the low price came back into the CC zone, with a perfect retest at the top of the range. This is slightly bearish for me at the moment. No trade zone currently and would like to see lower prices

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Would love to see price come back into the supply zone below where we have a gap up.

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Let's see where price action will lead.

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Would love to see a move like this

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BTC and MSTR divergence today. Bitcoin up over SWB:69K , while MSTR is bleeding a bit. I think Ive seen this sensitivity before.

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Rolling over

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On the longer term view, the golden fib and Value Area Low is coming in just below the first support. I will be watching for this scenario, great zone would be $1250-$1300.

If that is true support we should see a strong reaction.

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Coming back to re-test this neckline , would be quite careful here. No trades for me until we flip the upper level of red resistance into support.

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Lets see if we can hold support

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Starting to add shares on this drop at $1500

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Losing previous support zone. Looking towards the previous support zone below around $1300 for more accumulation

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You can see the resistance more clearly on the shorter time frame

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Next accumulation zone below at the value area low. So far it seems like we are rejecting the POC

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Im also aware of the potential bounce from the CC here at 1400

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I do feel like we will likely come into the buy zone below, as the price action seems to be rolling over

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Here is my confluence for the long trade

Trade active

Adding some MSTR down here at $1345. And will add some if we drop even lower.

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Expecting some kind of a move soon as we near the apex of the triangle consolidation.

Trade active

Adding more shares at 1300

Trade closed: stop reached

Out for a small loss. Will be patient now and wait for more clarity in the market.

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Looking towards a new long trade idea.

I have some confluence zones marked from previous price aciton. By using the fixed range volume of the current triangle consilidation, I noticed the value area low in confluence with my level.

I will be watching the reclaim above 1300 , which may bring us right up to the POC of the range.

Trade active

Lets give it one last try

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Nice move

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If we get a pullback in the next couple days, I will be looking towards to previous range S/R flip. Holding above $1480 would be bullish to me.

Trade active

Trading the plan

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Nice move, exactly as predicted.

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Starting to form some divergences. Great profit taking zone.

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Taking a look at the fixed range of the price action on the 10m chart to understand where my value areas are.

Im looking at the point of control for buyer to step in and bring it higher, if we plan to continue the rally.

If not, a break below the POC with a retest rejection would likely bring us down to the Value Area Low and we can see where the markets will be at that point in time.

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10% Bounce off demand zone

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Another 8% this morning

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Will be looking out for this potential scenario

Trade active

Sticking to the current trade plan, purchasing at these lows. Invalidation would be a strong red daily close below $1480.

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Nicely respecting the demand zone.

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I must say, I did not expect the volatility with this weeks black swan event.

However, I do want to urge extreme caution at this moment as MSTR has officially done a 10 to 1 stock split. It will be significantly easier for the general retail to buy this stock now. This can increase liquidity and give sellers an out of the market.

Below us I do see a weird bit of gaps that have yet to be filled. They are at approx $80, or the previous $800.

Yesterday, we had lost the value area low of the range. At first, we had seen a nice big pump from a major low back into value, however yesterdays close showed us the true weakness in the market with a big move back below.

I will look for the reaction at $80 first, if we do not get anything then I will update the idea at a later time when more information is available.

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