Is $MSTR A Good Buy Right Now?!?

The presenter discusses the recent decline of MicroStrategy's stock price ($MSTR) and its potential for a short-term recovery, primarily due to its Bitcoin holdings. The presenter analyzes the risk-to-reward ratio and suggests a potential trade based on price action, highlighting the importance of Bitcoin's price in influencing $MSTR's trajectory. The presenter ultimately concludes that $MSTR is not a long-term investment but presents a potential short-term trading opportunity if specific support levels are met.

MSTR Stock Price

• 00:00:00 The presenter discusses the recent decline in MicroStrategy's stock price ($MSTR), noting that it has crashed and is oversold, potentially presenting a trading opportunity. The presenter had previously shorted the stock and profited but is now considering a long position based on a risk-to-reward calculation. They caution that the current price action is still bearish, and it is crucial to wait for confirmation of an uptrend before going long.

Bitcoin's Impact on MSTR

• 00:03:37 The presenter highlights that Bitcoin's price is a significant factor impacting MicroStrategy's stock price. Bitcoin's recent retracement below its moving averages could lead to further declines in Bitcoin and, subsequently, in $MSTR. They mention a potential decline in Bitcoin to the $70,000 to $80,000 range, which would likely result in a drop in $MSTR's price as well.

Risk-Reward Ratio

• 00:02:23 The presenter calculates the risk-to-reward ratio for a potential long position in $MSTR, finding a favorable ratio of 6.36, suggesting that for every 6.36 of potential profit, there's a 1% risk of downside. However, they emphasize that this ratio is only meaningful if price action and indicators support an upcoming uptrend.

Support and Resistance Levels

• 00:01:55 The presenter points out that $MSTR is testing a previous support range, which it has bounced off before, and believes it might do so again. They emphasize the importance of watching if the previous support level around $320 to $340 is validated, which would be a signal for a potential recovery and a buy opportunity.

Investment Recommendation

• 00:06:55 The presenter concludes that despite the potential for a short-term trade, $MSTR is not a long-term investment in their opinion. They believe it is an overhyped crypto company whose primary business is purchasing Bitcoin, and that a direct investment in Bitcoin is a preferable approach than indirectly through $MSTR.